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Colombia is one of the best places in Latin America for women entrepreneurs, driven in large part by a high labour force participation and a high representation of women business leaders. According to a report index march 2022 Mastercard, women represent 55 percent of the business leaders in the country, located in Colombia at number one on this metric. Almost a third of women of working age in Colombia are involved in business activities, a proportion comparable to that of the men. The economic participation of women benefits to their families, communities and the country at large; creating, in the words of UN Women, “economies that work for women, they work for all”.

Despite this positive environment, women entrepreneurs in Colombia face significant obstacles. Only 25 percent of companies in Colombia are the property of women, and they have to close their business due to lack of financing double the rate of their male counterparts. rural women face even more challenges, as informality, both in business and in employment is more common, the time and transportation costs are higher and the rural communities often lack connectivity or access to the appropriate technology. There is a perception of “two Colombias”, a experiencing a rapid economic growth and innovation, primarily in the cities, and the other, a Colombia more rural, even in poverty and the aftermath of decades of conflict, unable to access that same promise.

Historically, the private sector in Colombia has focused much more on that first Colombia: a more developed market and ready for investment. despite the logistical challenges, USAID and the private sector partners are well positioned to drive sustainable economic growth and inclusive in the rural areas of Colombia, with a huge impact among the people who most need it.

Antioquia: A “Mini-Colombia”

Antioquia is the sixth-largest department of Colombia by area and second largest by population, comprising 125 municipalities and 6.6 million people. Covers a landscape vastly diverse: mountains, coasts, plains, plateaus, rivers, swamps and forests. This geographic diversity results in economic diversity, cultural and agricultural, and its capital, Medellín, colombia, is a financial center. The combination of Antioquia urban municipalities, rural and most affected by the armed conflict in the country reflects to Colombia in general and makes it a good place to test development programmes which could then be extended. 

For these reasons, the Axis of Gender Equality and the Empowerment of Women from USAID, USAID Colombia, and the team of Exploratory Programs and Innovation Contests of USAID chose to Antioch to launch the programme “Expanding the Access of Women the Commercial Capital ” in 2021. The program aims to bring together financial institutions, business support service providers and other intermediaries, and community organizations to improve financial services for women, especially in rural areas.

Through the program INVEST USAID is involved in Micro-enterprises in Colombia, an organization integrated by a savings and credit cooperative, not-for-profit organization and a corporation with an arm of support for business and financial education that has been working in the region since 1980. They are working in a consortium with Corporation Prodepaz, MET Community and the Caja de Compensación Familiar Comfenalco Antioquia for to close the gap in financial inclusion women in Antioch, each bringing their own strengths complementary to the project. The first step was to clearly identify the most important challenges to obtain credit for the women who need it.

Antioqueñas, the women of Antioch, have a reputation of being optimistic, hard-working, resourceful and proactive. Not, however, face significant barriers to access to capital, allowing them to build and scale their business and contribute to sustainable development in their communities. 

A focus group of these women found that 81 percent failed to get guarantees to support its credit, as a co-signer or support through assets or ownership of land. More than half had difficulties with their credit and, specifically, the risk rating. Finally, the 95 percent reported that the biases of gender stereotypes about the capabilities of women and the roles domestic) hindered its autonomy and independence, and that of other women.

A three-pronged approach

With this information, Micro-enterprises of Colombia and its partners decided to address these challenges from three different angles. 

First, are establishing new options of savings and credit, especially designed to reach women in rural areas of Antioquia. Established a new line of credit prime rate, the lowest in the portfolio of Micro-enterprises. it Has a shorter period of time, not to exceed 24 months, for women to be able to establish more quickly a credit history healthy to allow them to engage with financial products more traditional. Finally, the loans are usually smaller than the market average, most under $1000 (5 million colombian pesos), since these loans are smaller in size do not require collateral.  

In the second place, the project is strengthening the entrepreneurial skills of rural women through training in leadership, marketing, and administrative practices and financial. through this component, the women can access advisory, connect with other entrepreneurs, strengthen their leadership skills and access to digital platforms to promote their products or services. 

Finally, the project partners are working toward a mobilization of the broader system, creating actions and policies to empower women socially and economically. Carolina Toro, director of the project, a psychologist specializing in gender that works with Micro-enterprises in Colombia, from thirteen years ago, explains: “We are aiming to several different audiences: families, so that they can provide adequate support; the public sector, to establish and properly implemented appropriate policies; the private sector, to include gender policies in their operations and to open their doors to women; and the financial sector, so that we can recommend practices that create an economic system more fair and inclusive.”

Impact of the Initiative INVEST

A little more than half of the way from its launch in November of 2021, the project has mobilized more than $3.9 million (18.900 million colombian pesos) in funding for women antioqueñas. it Has given credit to over 4,200 women in 120 of the 125 municipalities of Antioquia, including 22 of the 24 municipalities affected by conflicts of the department, and 32 % of rural women, which shows that the program is aimed successfully to rural women and women affected by conflicts that have more problems to access to financial products traditional. As a result, the Development finance Corporation of EE. UU. (DFC), with the support of USAID Colombia, is delivering a warranty of up to $8 million to support the loans disbursed under the project, especially for amounts above $1000 (around 5 million colombian pesos). that require guarantees which are generally lacking in the female. 

“Some women have told us that they started a savings habit that I never had before,” says Bull. “Many are entering the financial system for the first time and increasing their incomes.” Leidy Gomez, owner of a study of massage therapy in the town of La Ceja, notes that “this access opens a lot of doors to which we had not touched on before, because we had managed our finances primarily internally and never get credit for our business. and we are delighted with this opportunity to grow.” Thanks to the loan of $950 (4.5 million colombian pesos), the credit of Leidy is up to date and has been able to start saving part of their income on a monthly basis. This small change could provide the basis for companies such as Leidy reinvest their profits to further improve the profitability, productivity and efficiency. 

More than a thousand women in 111 municipalities have participated in training programs in entrepreneurship, development of pitch and digital marketing. “it is Not just the financial product which we are offering,” said Bull. “it Is a comprehensive package: take them by the hand throughout the process.” Micro-enterprises has made a major effort for the training to be as accessible as possible for rural women, most of them are virtual, accessible through videos and Whatsapp, with individual follow-up. Given that connectivity is a major problem in the most remote areas, the program has paid data plans for women who need to access the classes, but have discovered that many women need additional support in literacy digital to take full advantage of these tools. 

Isabel Cristina Alvarez , a farmer in the small village of Pantalio, has been saving as part of a cohort of Micro-enterprises in Colombia for about a year. “Micro-enterprises has helped us with training. For example, right now we are training in financial education. Was that we sent a video weekly, and we did an activity on the subject.” She says that the value of the program is its accessibility and convenience for rural women like her, “because it is easier to save in the people here in which the people go”.

Finally, the project has worked with 16 groups of women in the organizational strengthening (25 at the end of the project), and twelve municipal governments, various are pushing agendas with a focus on gender, having conversations with the different stakeholders to prioritize women's issues and propose solutions. The project partners have also worked directly with 80 families to improve equity within the home so that women can have a greater autonomy, and to devote more time to their business. Within the private sector, twenty companies are interested in participating in a procurement strategy inclusive, which gives priority to women providers. 

The project has been transformative for Micro-enterprises of Colombia as an organization. “We have an institutional policy of gender since 2018,” says Bull. “But the project has been an opportunity for the institutional strengthening: look inward to examine our practices from a gender perspective”. The organization formed a committee with several areas of leadership represented, which he completed internal and external evaluations in order to renew its institutional policy. it Was first announced in November 2022 and it was publicly introduced in April. 

Thinking in the future

Currently, Micro-enterprises in Colombia is integrating recommendations to different stakeholders to continue to improve the economic opportunities of women and to create an entrepreneurship ecosystem is the most favourable.  

“We're betting on the women of Antioch,” says Bull. “This partnership is giving them a place and making them active members in society and in your family. This project has planted a seed that will continue to fuel, as a company that believes in the empowerment of women”. on A personal level, he adds: “I Think this work is very important and I truly believe that when we work with women, there is no turning back”.

ABOUT THIS STORY

Women entrepreneurs in Colombia face significant barriers, especially in rural areas where lack of access to financial products and education to build their business. With the support of USAID, Micro-enterprises of Colombia is developing a new line of credit designed to support rural women, providing business training and leadership, and help more colombian organizations to incorporate gender policies in their operations. The project addresses the urgent need to bridge the gender gaps widespread in financial inclusion, improving the lives of women and their communities.

Featured image: the business of Yuri Jisela Rivers Restrepo, AVA3D, manufactures prints custom 3D planters, geometric figurines of pets and animals, and other custom products in Itagüí

 Karina Arlo.