9 April 2021. How can the Food Systems Summit catalyse new solutions to these challenges? This event looked at proposals from the FSS process and examples of solutions from different regions, and consider their potential from the perspectives of women entrepreneurs, investors, and other key stakeholders.
Access to finance is a top challenge for agri-SMEs, and often particularly so for those with innovative business models and for young and women entrepreneurs. The reasons for that include, on the entrepreneurs’ side, lack of physical collateral, limited business management capabilities, lack of credit history, and limited projected returns for their business models, especially when set within poorly functioning markets. On the finance supply side, the reasons for the challenge include lack of adequate financial products, standard procedures with high transaction costs, and limited capacity to properly assess and manage the risks involved with serving this market segment.
Women entrepreneurs often struggle particularly to access forms of capital that require physical asset collateral, as they are less likely than men to own land and other physical assets. In many contexts, they are also less likely to have access to formal sources of business development training, advisory services, technology, and markets. More often than men, they face the challenge of balancing house and family care responsibilities with starting or growing an enterprise. Like other small or medium scale entrepreneurs, many operate in markets that lack a diverse pool of capital to meet the different needs of their enterprises as they grow or lack information to navigate the financial system.