“Many women entrepreneurs in the Huye city market are largely excluded from the Micro Financial Institution (MFI) services due to a lack of information, inadequate knowledge or misinformation.” Read research findings
Rwanda’s government has eyed the potential in creating financial environment for women as strategic pillar tends to increase country’s economy, but particularly to enable women entrepreneurs access to financial services.
This comes after being observed that the men largely possessed big number of financial institutions’ users which led to women’s underdevelopment for several years and financial inclusion imbalance.
Financial institutions have been imposing harsh conditions to women which could not allow them access to financial institutions’ services particularly loans, for fear of failing paying back.
Hence, Rwanda has increased women’s financial inclusion and closing the women’s SME credit gap, by enabling financial policy and regulation favors the women and youths’ access to financial services.
However, thought the government targeted 100 per cent of financial inclusion by 2024, the research indicate how most rural women are yet to collaborate with financial institutions due to several factors.
A research titled “Financial Information Seeking Behaviour Among Women Entrepreneurs” by Prof. Margaret Jjuuko, Dr. Joseph Njuguna and Patrick Ruangangabo, conducted in Huye City, has unveiled that several women entrepreneur never knew the existence of MFI’s that run specific program for women and youth who engaged in business.
The study interrogated the financial information-seeking behavior of small-scale women entrepreneurs in Huye–exploring their knowledge of microfinance institutions (MFIs), the financial services available to them; their accessibility and usage of financial information.
Unfortunately, majority of women interviewed, has never heard of or collaborated with the nearby financial institutions for their business development due to lack of information, yet they are interested.
“Overall, a significant gap in information about MFIs and financial services that specifically target women was evident amongst the respondents in this study. The informed few were reluctant to commit for fear of breaking the MFI’s restrictive credit requirements”
As information shortage about the nearby Financial institutions including BRAC, Urwego and Duterimbere IFM limit women to benefit from their dedicated program, most women claim this to have been a loss, saying they would use it in their development
“I have heard of Duterimbere, but being a rural businesswoman, I have been waiting for them to come and market themselves to us. Only the big banks make regular visits, but these have higher interest. If they [MFIs] visit me, I might be inspired to quit agriculture for business.” Said a research participant
The research found that most women entrepreneurs have low opinion about the financial institutions, given to their level of poverty. Most didn’t consider financial institutions as a better option to boost their business and remove them out of poverty.
They sow the institutions as high profile and out of reach for them.
“I always feel like working with banks is only for the rich; it has nothing to do with me. I hear that when you take credit and fail to pay it back, everything in your family is sold to recover the money, so joining such MFIs is to be cursed.” Said participant.
According to this researchers, since knowledge and information are generally viewed ad propeller for development, women’s participation in entrepreneurship are mostly affect by the lack of access to and use of financial information.
Consequently, these women are trapped in an imbalance of less start-up capital in investment ventures and low labor force participation.
While the findings indicated a gap in how financial services communicated to women entrepreneurs, the three researchers recommend financial institutions to actively communicate their services to women entrepreneurs.
By Patrick Rurangangabo