Most of us take banking and payment systems for granted. We don’t give a second thought to paying for what we need with a credit card, a check, or a quick trip to the ATM. In recent years, technology has provided even more convenient ways to pay for our latte or our electric bill with online banking, Apple Pay or Google Wallet.
But for many people around the world, including the rural women in sub-Saharan Africa that we work with at Solar Sister, these formal financial systems are out of reach. Women are excluded from the financial offerings that require proof of income or assets to unlock. Because women bear an overwhelming burden of unpaid care work and even when they are earning income their income is often generated in the informal sector, they often have little in the way of formal pay evidence. Legal and cultural norms prevent women from owning property, which means they don’t have the collateral needed for credit. This lack of income, assets, and social capital represents a barrier to financial inclusion and results in an inability for women to realize their full economic potential.
The repercussion of financial exclusion is that rural women cannot build a foundation for their businesses, they cannot borrow to leverage their efforts, they cannot attract investment, and they cannot protect their savings and accumulate wealth. They are restricted to a very precarious cash-based economy that lacks a method to build and preserve wealth.
At Solar Sister, we are addressing this challenge by building financial inclusion into our business support for the Solar Sister Entrepreneurs. We have established a credit program for our entrepreneurs that allows them to double their turnover, build a credit history, and expand their business. We deliberately tackled the barriers to inclusion by designing an innovative credit approval process that bypasses the requirement for collateral that keeps credit out of reach for most women, and instead looked to the entrepreneurs’ business history and social capital that they have built as successful Solar Sister Entrepreneurs.
We are thrilled to be included in Reimagining Financial Inclusion: Tackling the flaws of our formal financial system by Erlijn Sie as one of the 13 game-changing organizations tackling financial inclusion.
Putting women at the center is key for their success; It’s not just a profitable micro-enterprise model reaching the rural villages in Africa, it comes with investing in the women, in female leadership.
The book analyzes the innovative and inclusive solutions of these game-changers and delivers vital lessons through a framework of five key levers for change in order to reimagine our financial system. Awareness and support for a more sustainable and inclusive world have never been higher and financial inclusion is a key element of this global issue facing modern society today.
Available to order here: https://lnkd.in/dKjigpGK