According to IFC research, an estimated $300 billion credit gap exists for women-owned enterprises, plus other barriers such as unfavorable business and regulatory conditions.
To end this, World Bank Group’s IFC, and Goldman Sachs 10,000 Women program have launched a $600 million global facility to help over 100,000 women in emerging markets increase access to finance. The fund is expected to extend credit to women run SME’s.
Dubbed the Women Entrepreneurs Opportunity Facility, the fund is the first such set exclusively to financing women-owned SME’s in developing countries.
“This new initiative will create opportunities for tens of thousands of female entrepreneurs to thrive and prosper,” World Bank Group President Jim Yong Kim said. “At the World Bank Group, we are committed to providing opportunities to aid women as leaders, business owners, employees, and stakeholders. We cannot afford to exclude half of the world’s population from their rightful role in helping to change the face of the global economy.”
Agreeing to Word Bank Group President, Nena Stoiljkovic, IFC Advisory Services VP and World Bank Group Global Practices VP, said: “IFC is delighted to partner with the Goldman Sachs 10,000 Women initiative, which has an impressive global presence. We need innovative models from the private sector to create opportunities for women entrepreneurs to thrive and prosper.”
In the deal, IFC and Goldman Sachs Foundation will provide the initial $100 million and $32 million respectively to the facility, which will be managed by IFC which will also fundraise for the additional $468 million from public and private investors. Goldman Sachs will also provide $18 million in grants-$11 million of which will go to IFC to provide advisory services— to expand financial-planning support for women entrepreneurs. Apart from money, IFC and the 10,000 Women program will also provide training and advice to women entrepreneurs.
The facility is part of the World Bank’s overall strategy to promote gender equality and ensure the social and economic welfare of one-half of the world’s population. Through its Banking on Women Program, IFC is stirring the growth of women-owned businesses.
Lloyd C. Blankfein, chairman and CEO of the Goldman Sachs Group, Inc. , said: “Through the experiences of the 10,000 Women graduates, we have seen first-hand that investing in women is a key source that leads to economic growth, but there is clearly more that can be done. By partnering with IFC, we will address one of the biggest obstacles to growth for women-owned small and medium businesses: access to capital.”
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