The incidence of poverty among women, as well as its depth and women’s vulnerability, is particularly marked in sub-Saharan African countries where women often encounter more obstacles in starting and sustaining businesses. The cause of this condition for women in Africa are numerous, including traditional restrictions on their property rights, weak governance and violent civil conflict that perpetuate gender discrimination and poverty in those countries. Women also face many barriers to economic participation. At the same time, their contribution to economic activity and development is substantial.
SERO Lease and Finance Limited (SELFINA) is an indigenous enterprise in Tanzania created by Dr. Victoria Kisyombe, a country veterinarian, and was born out of a need to overcome the barriers that social norms and customary law often impose on women entrepreneurs in the East African country. She was motivated to launch a business to provide women entrepreneurs, specifically micro-entrepreneurs in rural areas of Tanzania, with the financial support they needed to create and sustain their own business. Her personal experience opened her eyes to a new horizon — that of widows left without land or significant assets.
“The specific problems are diverse,” notes Kisyombe. “Women are oftentimes the breadwinners for large, extended families, playing an integral role in the rural economy, but they cannot obtain the equipment to maximize their income. In Tanzania, to get assets, one needs collateral, which for the majority of Tanzanians, could only consist of land. Women are largely uneducated about the need to obtain official deeds for land that may have been passed down between generations. Thus, when the time comes to use the land as collateral, women seldom have a way to prove ownership.”
SELFINA has addressed the above challenges by pioneering micro-leasing as an effective and practical way to get around the problem of lack of collateral and increase access to finance for women. The company also entered a wide variety of industries tailored to a diverse set of women entrepreneurs, including cooling, machinery, transportation and livestock.
They offered a credit window exclusively for women and focused on two products: (1) leasing equipment on a financial, rather than an operational, basis (where the lessee has the right to ultimately own the assets); and (2) buying women’s equipment when they needed liquidity and then allowing them to keep the equipment on lease, a facility termed sale and leaseback.
Dr. Kisyombe said, “What keeps me going is actually when I see what the little we’re able to do,how it translates in the life of other women and their family. That you cannot put into simple words: it’s here in my heart. You change lives; you touch peoples’ lives. As I’ve said time and again, it’s really rewarding.” In recognition of her work in creating business opportunities for women in Tanzania, Kisyombe was recently honored at the 13th Annual Global Leadership Awards held by Vital Voices Global Partnership (which was by former U.S. Secretary of State Hillary Clinton), receiving the Economic Empowerment Award.
From just a few dozen clients in 2002, the company was financing more than 200 in 2004. As clients accomplished a 98% repayment rate, confidence in the company grew and demand for its products skyrocketed. In less than five years, between 2004 and 2009, SELFINA grew its client base from approximately 200 contracts to more than 16,000. Portfolio volume also grew exponentially, by more than 600%, and by the end of 2008, stood at TZS 7,000 million (Tanzanian Shillings), about $5 million.
It is a remarkable achievement. SELFINA wants to bring about not only economic change but social change too. There is an influential view that argues that by putting more spending power in the hands of poor families, and perhaps more importantly, in the hands of women, micro credit and micro-leasing can expand investment in child health and education, empower women in their homes and reduce discrimination against them. They want women who have long suffered as second-class citizens to be allowed to make a better quality life for themselves and their children. In turn, their empowerment can build healthy families, a dynamic community and a stronger nation.
Source: This blog appears on the SELFINA website.