Whilst Africa’s food security troubles have been framed largely as inadequate food production, the agricultural ecosystem has multiple gaps in the supply chain that exacerbate this issue. Historically, the complexity of agricultural value chains from primary production, access to quality inputs, logistics, and access to markets have contributed to the slow pace of growth in the sector. Recently, climate-induced shocks and fluctuations in food prices have further worsened the state of food security in the continent. As a result, an estimated 140 million in the continent are at risk of severe food shortage and undernourishment. In order to create sustainable solutions to food security, entrepreneurship plays a critical role by increasing local food production, promoting sustainable agriculture practices, and building resilient food systems.
Seeing that entrepreneurship plays a pivotal role in enhancing food security, it is critical that entrepreneurs are well supported to actualize this desired impact. As entrepreneurs, women play an integral role in food production. 80% of women in sub-Saharan Africa are involved in food production and 60% contribute to labour in the agriculture sector. Women comprise a third of SMEs which are largely informal in nature, home-based, or cottage industries. Women entrepreneurs are therefore essential in food security and by supporting them to grow, we can change the narrative from helping hungry Africans to Africa feeding the world.
VISA Foundation sponsored a session at the 10th Sankalp Africa Summit that looked at agriculture from a systems-level approach and explored approaches for graduating and supporting female entrepreneurs throughout the value chain.
Customized technical support to deploy sustainable business models
Having a gender-inclusive entrepreneurship ecosystem in agriculture involves creating an enabling environment that supports women’s participation and empowerment as entrepreneurs. Women entrepreneurs are limited to small and low value businesses and are unable to graduate to higher levels in the value chain, where more value is being created and more money is being made. Lack of technical know-how to develop niche products and scale production capacity to meet demand was cited among the reasons why women businesses are unable to graduate. As a result, few women have grown their agri-businesses, and those that have succeeded to grow, have taken a very long time to grow organically. Research insights by Value for Women show that women involved in agri-business value chains require customized and nuanced technical support. In addition, networking or peer-to-peer support can enrich the technical support programs to foster learning.
Intentional and focused replication of gender mainstreaming best practices
Gender mainstreaming requires a deliberate focus on incorporating gender inclusion best practices by intervention programmes. For instance, TechnoServe is committed to pursuing gender equality and women’s economic empowerment, and it recently released a Gender Equality Policy and runs a Gender Champions Network, to integrate gender across businesses and clients. Whilst these were significant milestones for the organization, this requires an intentional and inward approach to implement the same across all levels of the business. On the client front, TechnoServe programs have been curated based on the lessons that have proven to work in empowering women entrepreneurs rather than reinventing the wheel.
Innovative financing mechanisms to address the gender gap
‘Women entrepreneurs are over-mentored but underfunded’ is a common statement in the investment ecosystem. It is estimated that there is a gap of USD 15.6 billion for women involved in agriculture value chains in Africa. Women-owned businesses face considerable hurdles and biases in access to finance compared to men. Lack of collateral, irregular cashflows, high risk perception, and unproven business models among others hinder women from access to conventional financial products.
While there are many programs and initiatives that have been implemented to support women entrepreneurs to access finance, there are challenges that need innovative thinking to further bridge the gap. One such challenge is that a lot of time and resources are invested in capacity building for women entrepreneurs, and yet only a small number of women are successfully onboarded and transitioned to higher levels of business operations. Root Capital invests at least three years in providing tailored support to women entrepreneurs before offering finance. Another challenge is that the financing products are not meeting the needs of women-owned businesses. Investors and financial institutions need to be incentivized to tailor-make products more suitable for women.
System-led approaches and innovative models are required for graduating female agri-preneurs throughout the value chain. Support programmes that are women-focused play a pivotal role in empowering women entrepreneurs and supporting their business growth. Best practices from these programs should be widely shared within the ecosystem and built on in order to further close the gap.