A Dive into Women Entrepreneurship in Kenya for International Women’s Day

As part of International Women’s Day, we are taking a moment to celebrate the women entrepreneurs around the globe.

From contributing to their local economies to providing a stream of income to their own families, there is no doubt that the world needs more women entrepreneurs. But in Kenya, the growth of female-owned businesses is still slow. In this article, we dive into the reasons for this outcome and explore how we, as a community, can help move things forward.

The world needs more women entrepreneurs

Photo by Ayo Ogunseinde on Unsplash

In Kenya, women-owned businesses make significant contributions to the national economy; notably, they account for 48% of all micro to medium sized enterprises which in turn constitutes 20% of the country’s GDP (World Bank Group 2006).

According to a report by the International Finance Corporation and the World Bank, of the 462,000 jobs created each year since 2000, 445,000 come from the informal sector where 85% of women-owned businesses are located (World Bank Group 2006).

But the benefits of female entrepreneurship are not limited to their economic contributions; women business owners are able to achieve social impact through providing a tightened sense of community. For instance, women venturing in the handbag crafting business would often gather to form self-help groups. It is then no surprise that collaboration like these are key to empowering women to engage in the business field. (ILO 2015)

Running a business is also beneficial for the entrepreneur’s family. Investments in the children’s education and the ability to increase the wealth of the family are two of the emerging themes in a survey of women entrepreneurs conducted by the International Labour Organization (ILO 2015).

​The barriers to female entrepreneurship

Access to credit

In Kenya, the most important hurdle for women business owners is accessing capital, precisely loans and financial services.

​While it is possible to get loans from formal institutions, the process is often lengthy and complicated, not to mention the need for collateral, a common limiting factor.

Since property is used as collateral for business credit, having access to land and property rights is essential. But there is a problem : only 1 to 6% of land titles are owned by women.

Consequently, only 9% of the available credit is attributed to women (World Bank Group 2006).

"The issue is easy access to these financial schemes and also the issues of the ownership of property. For example, a financial institution would want you to put assurance based on a property on assets. So you have to come and consult the husband, [and] the husband says no." - KII, an Implementing Organization of the ILO’s Get Ahead business training programme

Gender discrimination

Photo by Samantha Sophia on Unsplash

A common battle women have to face is gender discrimination. When it’s not the negative stereotypes and the criticism  from community members, it’s the unjust treatment of official establishments. Many women surveyed by IFC & World Bank report having been ignored by bank officials who prefer to speak with their husbands or male business partners. 

Roseanne Ndiga, an entrepreneur interviewed by the IFC, shared her experience : “When I took my proposal to the bank, the banker would not even see me. I don’t know if it was the fact that I was a woman and pregnant at the time, but when I went to present, he was not paying attention at all. But when the other directors came - they are men - he listened.”

How you can help

It is clear that there is no simple solution for the obstacles women business owners face in Kenya. The myriad of challenges does not purely involve the aspect of business; it touches on considerable issues such as education, access to justice, tax reforms and gender advocacy. However, there are ways you can lend a helping hand.

Microfinance represents a decent alternative for women looking for financial support. Institutions like the Kenya Women’s Finance Trust and the Credit Cooperative Society offer services

specifically for women and their micro-enterprises. 

Here, at Mkono, we strive to have a similar strong impact : empowering young women to bring a change in their communities. Our loans represent a launching pad for women looking to start or expand their own business, and our mentorship sessions provide guidance and reassurance. Through donations, we are able to help women like Mary Muriithi from SpeedGo Express, Ann Gitari from The Writing Agency, Lilian Oyugi​ from Yototo Yogurt and Caroline Odera from WISE Initiative.

​Together, let’s take action for equality.

For a more extensive insight on the situation of women entrepreneurs in Kenya, we invite you to take a look at these two reports by the ILO and the IFC & World Bank.

Happy International Women’s Day!