Shs635b earmarked for EAC women in business
Ms Eve Zalwango shows some of the furniture she makes. Her business as well as several others in the region have the opportunity to benefit from the evolving fund. PHOTO BY RACHEL MABALA
Kampala- The East African Community in partnership with the East African Development Bank, is setting up a $250 million (about Shs635 billion) liquid revolving fund to support Small and Medium Enterprises (SMEs) owned by women.
The fund, which is expected to roll-out this December, will help in closing the gap women in business have been experiencing especially in accessing finances.
Many women in business have not succeeded due to the failure to access credit, among others.
Ms Ruth Kihiu, the coordinator of East African Women in Business Platform, said the beneficiaries will access the fund through the principal financial institutions in the respective member countries, for on-lending to women-owned businesses: “The fund will be accessible to women-owned businesses in the respective member countries.”
She said strict mechanisms of monitoring will be used to ensure that the fund helps the targeted beneficiaries.
East African Development Bank (EABD) will do the mobilisation and managing of the funds. This will be done in done in three years.
The beneficiaries will have a loan minimum of $5,000 and a maximum of $2 million.
To protect the financial institutions just in case of default, another $6.6 million fund has been set aside as collateral guarantee for up to 75 per cent of principal for women-owned business borrowers.
However, women-owned businesses that are not in order will have access to a$5.5 million technical support fund.
Nature of businesses
The study was done in all types of businesses ranging from services, retail trade (including petty trade and hawking of vegetables, fruits, second hand clothes and shoes), textile, lifestyle, beauty, art and crafts, small eateries and restaurants, beauty and spas.
Other businesses are in the manufacturing sector, transport, trade facilitation, mining (in Tanzania) and construction.
It was recommended that the EAC invests in financial inclusion of women- owned businesses and this is to be fast-tracked with the establishment of a regional financial facility at EADB.
Accessing Funds
Avenue: To access the funds, women in business will apply to the respective commercial banks and micro-finance institutions which are yet to be named.
Fund: The Fund is the first of its kind as the region moves to support women-owned SMEs.
