Visa a global payments technology company, has launched the Visa Foundation from which a US$20 million grant has been given to non-profit group Women’s World Banking to invest in female-led businesses in emerging economies.
Women’s World Banking, an international non-governmental organisation based in New York, will distribute the funds over five years with the aim of giving female business owners in Mexico, India, Egypt and Nigeria access to financing needed to grow their enterprises. Visa has said it is developing eligibility criteria for the allocated capital along with financial services to reach what it estimates are around 50 million underserved entrepreneurs in its target countries.
Stephen Kehoe, Visa’s senior vice president for global financial inclusion, said the firm’s support for female-led businesses could produce what he called “a multiplier effect” on its social and economic impact, meaning families and communities are likely to inherit greater stability from their successes.
Kehoe added that women in developing countries typically struggle to access the financial services necessary to take their start-up businesses to scale in the earliest stages of growth. Major barriers include legal and lending requirements that favour their male peers, such as needing their husband’s permission to register a company, open a bank account or put up collateral.
“Women and women-owned businesses continue to be disproportionately excluded from accessing formal financial services, impacting hundreds of millions of individuals,” he said.
According to a report by International Finance Corporation (IFC) titled: Investing in Women: New Evidence for the Business Case, over 150 economies have at least one law impeding women’s economic participation with subsequent negative effects on private sector growth. The report also states that at present, the credit gap for female-owned small-to-medium sized enterprises stands at around US$285 billion.
Mary Ellen Iskenderian, president and CEO of Women’s World Banking, said: “We will deliver solutions that drive women’s access and usage of innovative financial services, so that they create economic opportunity for themselves and their families.”