The financial landscape in Africa is undergoing a profound transformation, and at the heart of this evolution are women who are increasingly asserting their influence, driving innovation, and championing financial inclusion. While challenges persist, the narrative is shifting, with women actively breaking barriers and creating a more equitable and dynamic financial future for the continent.
Historically, the financial sector across Africa, like many global industries, has been largely male-dominated. Women often faced significant hurdles, including limited access to education, cultural biases, and a lack of formal financial services. Despite making up a substantial portion of Africa’s workforce – indeed, 58% of Africa’s active workforce are women – only about 30% have access to formal financial services. This glaring financial inclusion gap, particularly for women entrepreneurs who face a staggering $42 billion shortfall in financing, highlights the systemic issues that have historically held women back.
However, the tide is turning. A growing recognition of the immense economic potential unlocked by empowering women is fueling a concerted effort to close this gap. “Solidarity with women is an economic strategy,” a sentiment increasingly echoed by financial institutions and development organizations, underscores this shift. Initiatives like the African Women Leaders Network (AWLN) and the African Women Impact Fund (AWIF) are actively working to boost access to capital for women-led businesses and increase female representation in leadership roles. The AWIF, for instance, has an ambitious target to raise $1 billion over the next decade to be allocated to women asset managers in Africa, who will, in turn, invest in high-impact and underserved sectors.
One of the most significant ways women are shaping finance in Africa is by driving innovation, particularly in the burgeoning fintech sector. Africa is a hotbed of fintech innovation, driven by the need to address the fact that over 350 million adults remain unbanked. Women entrepreneurs and leaders are at the forefront of developing solutions that cater to the unique needs of diverse populations, especially those traditionally excluded from formal financial systems. From blockchain-based platforms to digital lending services and mobile money solutions, women are leveraging technology to enhance financial accessibility, lower transaction costs, and create more efficient financial ecosystems. Companies like Klasha, founded by Jess Anuna, are transforming cross-border African commerce, while Hilda Moraa’s Pezesha is expanding financial access for small businesses. The rise of platforms specifically designed to empower female entrepreneurs and professionals, such as Herconomy, further illustrates this innovative drive.
Beyond technological innovation, women are bringing a much-needed customer-centric approach to the financial sector. With their inherent understanding of diverse community needs, women are developing financial products and services that are more inclusive, empathetic, and tailored to the realities of everyday life. This focus on the customer experience is crucial for building trust and fostering long-term relationships, especially in regions where skepticism towards formal financial institutions may exist. Their insights are helping to expand market reach, ensuring that financial services genuinely serve all segments of the population.
Furthermore, women are making significant strides in leadership and governance within African financial institutions. While representation at senior levels still has room for growth – for instance, only 12% of senior general partners in Sub-Saharan Africa’s private equity and venture capital firms are women – there is a concerted push to increase female presence on boards and in executive roles. The understanding is growing that gender-diverse leadership teams lead to better decision-making, improved performance, and enhanced profitability. Research indicates that gender-diverse fund management teams can deliver higher net Internal Rates of Return (IRR) compared to non-diverse teams. Organizations like the IFC are actively working with companies to promote women’s participation in the workforce and leadership positions through investments and advisory services.
However, the journey to full gender parity in African finance is not without its challenges. Access to finance remains a primary hurdle, particularly for women entrepreneurs. Traditional lending practices, often requiring collateral that women may not possess due to cultural norms or land ownership disparities, continue to be an impediment. Low financial literacy and a perceived lack of creditworthiness can also lead women to self-select out of the credit market. Addressing these demand-side and supply-side constraints requires a multi-pronged approach that includes financial education, innovative collateral solutions, and gender-responsive financial products.
Another challenge lies in dismantling existing structural biases and the “broken rung” phenomenon in corporate ladders, where women are often excluded from crucial career opportunities. This requires a radical rethink of talent and performance management systems to value diverse perspectives and experiences. Flexible work policies, robust support systems for work-life integration, and clear pathways for advancement that recognize diverse leadership styles are essential for retaining and promoting talented women.
Despite these challenges, the opportunities for women in African finance are immense. The continent’s youthful population, coupled with the rapid adoption of mobile technology, presents a fertile ground for inclusive financial growth. As women continue to rise in leadership, innovate with technology, and champion financial inclusion, they are not only transforming the financial sector but also driving broader economic development and prosperity across Africa. Their contributions are proving that investing in women is not just a social good, but a powerful economic strategy for the entire continent.