Tribute to our unsung heroes: Ugandan women in business

The 3rd edition of the Mastercard Index of Women Entrepreneurs (Miwe) has listed and ranked Uganda as the top country with the highest percentage of women-owned businesses in the 58 markets evaluated around the world. The other top two include Ghana and Botswana.

This is a great story of persistence by women who continue to drive the backbone of Uganda’s economy through SMEs. Despite all the advances, women in rural areas still fall far behind compared to their urban counterparts in terms of access to opportunities (markets, infrastructure, technology, affordable financing and education). Many women in Uganda become entrepreneurs by necessity (having no better choice of work) yet they are determined to succeed despite lack of financial capital and access to enabling services.

In terms of achieving gender parity in entrepreneurship, the Mastercard Index shows that Uganda has attained significant progress despite challenges such as inadequate financial inclusion, which cuts off many women from the formal money economy. In order to unlock the full potential of women in Uganda, we must continue to foster an entrepreneurship ecosystem for women that helps them to overcome barriers – cultural, legal, social, traditional, etc.

Gender-related biases are hindering women around the world from advancing their businesses. Yet women entrepreneurs continue to overcome these challenges - having a direct impact on the labour force, economic growth and the well-being of their societies. However, government and non-State actors have, through interventions, created opportunities that encourage rural women interested in starting up their own businesses.

The government has made some headway in promoting female entrepreneurship in the country. Key initiatives such as the Uganda Women Entrepreneurship Programme (Uwep) are already being implemented. Uwep is a revolving fund initiative, whose main objective is to increase women’s access to affordable credit. This is intended to enhance financial inclusion, promote entrepreneurship development and effective participation of women in the economic development of the country.

The Women Entrepreneurship Fund has been a great success so far. Currently in its fourth year of implementation, the programme has received Shs85b, representing only 14.6 per cent of the approved budget of Shs585b. So far, 9,381 women projects have been financed, directly, benefitting 117,551 women. In its creation, Uwep was intended to address the challenges women face in accessing credit from the formal financial institutions such as commercial banks. The banks still regard women as uncreditworthy because they lack collateral, among other improbable reasons. Uwep has demystified this and shown that women too can be credible debtors. For example, to date, Uwep has recovered Shs7b out of the Shs8.7b that is due for repayment. That represents an 80.1 per cent repayment rate. Government intends to build on these achievements and ensure that it makes it even simpler for women to access credit and entrepreneurial skills.

Uganda Registration Services Bureau (URSB)has also made significant strides in improving the availability and use of financial services for women entrepreneurs. With a new regulatory framework that provides for alternative collateral besides real estate, and with the presence of a modern online registry, through which financial and non-financial institutions can inform other lenders about their security interest in a particular movable asset, the risk of lending is reduced. This is helpful to the women as they can utilise their valuable movable property such as poultry, livestock, crops, plant and machinery, account receivables, inventory, household items as well as intangible items like intellectual property rights, as collateral for accessing loans and other forms of credit.

To date, 38 lenders, including commercial banks, credit institutions, microfinance institutions and money lenders have signed up to transact using the online registry system hosted by URSB.
From January 1, fairly priced loans valued at Shs661,669,027, have been disbursed to individual borrowers within a period of two weeks. The infrastructure put in place by URSB is, therefore, a major intervention aimed at lowering barriers to affordable financing for women in Uganda, who were underserved by the financial sector because many do not own any land or buildings in their individual capacities.

Another interventions that can be adopted to increase participation of women in business, is to understand their aspirations. In every rural community, there are also capable female entrepreneurs, who can be coached to become business leaders and provide productive employment and business mentoring services.
Other avenues can be exploited to facilitate financial inclusion of women is the adoption of mobile phone applications, particularly Mobile Money services. Technology offers promising possibilities to improve business operations for business women in Uganda.

Mr Bemanya is the Registrar General, Uganda Registration Services Bureau (URSB).