Dar es Salaam — Low-income female entrepreneurs, whose Small and Medium Enterprises (SMEs) suffered losses after the outbreak of the Coronavirus pandemic are being equipped with financial literacy skills to absolve their businesses from COVID-19 economic ravages.
Women working in the informal sector are among the most marginalized and underutilized citizens in Sub-Sahara Africa who are less likely to have access to training and credits even though they are the main caregivers of many households. They face a myriad of challenges due to a lack of business and financial literacy skills.
In an effort to cushion women-led businesses from the impacts of COVID-19 Equality For Growth(EfG)—a local charity working to empower women economically recently organized gender-sensitive training course to help low-income women protect their businesses in a crisis.
“This training is aiming to equip businesswomen with essential financial literacy skills so that they can budget, plan and live within their means,” said Jane Magigita, EfG Managing Director.
EfG strives to empower women working in Tanzania’s informal sector, to fight poverty through access to financial legal and human rights education. The firm envisions removing exploitation, gender bias, legal and economic barriers.
According to Magigita, the training entailed intensive courses such as book-keeping, how to prepare a business plan, budget, and how to manage their businesses during crisis all of which are designed to develop women’s financial skills and capabilities.
As businesses in the east African country are still wobbling in dire economic uncertainties, financial education is proving essential to ensure recovery and survival of women-led ventures.
“One of the most critical pathways to empower women is to give them the opportunity to learn financial literacy skills to positively change their attitudes and behavior towards money,” said Magigita.
While poor knowledge on financial matters among women is not a new phenomenon, observers say such training opportunities are vital to avert future crises.
“When the Coronavirus crisis struck, most women in the informal sector were caught off guard, worse still they didn’t know what to do to protect their businesses,” said Margareth Chacha, former Managing Director of Tanzania Women’s Bank.
According to her women’s economic empowerment increases economic diversification, boosts productivity, and bridges yawning income inequality with men.
Chacha applauded a recent move by Tanzania’s central bank to temporarily increase mobile money transaction limits and waive the fees during the crisis to ease the burden on women-led businesses.
Meanwhile, Magigita called upon banks and other financial institutions to momentarily defer loan repayments for women-led SMEs whenever a crisis strikes.
Magigita hailed how technology was shaping responses to the Coronavirus pandemic, especially the role that digital financial services played to salvage businesses in the country.
“Digital Financial Services play a significant role in stimulating financial inclusion for low-income women groups,” she said.
While women entrepreneurs are increasingly recognized as key drivers of economic growth, many of them are wobbling in financial doldrums that prevent them from sustaining their businesses.
The trainers also taught women to solve the challenges they face when trying to secure bank loans.
Although the informal sector constitutes a vibrant economic force in the east African country, officials say most small businesses die within the first year of operation.
In Tanzania the informal sector is made up of roughly 3 million businesses which provide approximately 48 percent of the GDP and 36 percent of the total employment, official government data show.
Asha Shababu (27) a trader at Tandika market in Dar es Salaam who attended the training said it has helped her to understand the importance of balancing her stock before the start of each business day.
She routinely tallies additions and deductions and jots the figure down on a handwritten ledger.
“I barely kept my sales record before,” Shabani said of her previous approach to run her business. “I have now realized every penny has to be accounted for.”