March 8and, the world celebrates International Women’s Day. This year, the world is focused on marching to break down gender bias.

However, as we enter the day, there are signs that celebrations should remain subdued as many women have recently suffered traumatic shocks to their economic circumstances, primarily due to COVID-19. Unfortunately, the industries that have seen the biggest declines also have higher female participation rates, which means that COVID-19 has disproportionately affected women.

This means that over the past two years, women have not only had to deal with systemic biases, but have also had to adapt to the challenges of the pandemic. Unfortunately, for some women entrepreneurs, these barriers have been a breaking point.

An uphill battle for women in Africa

Women entrepreneurs are not a minority, they represent 58% of the self-employed population of the continent. Yet ingrained biases about their business skills, technical abilities, and even leadership are holding back business growth. One might think that these prejudices do not exist, but they do.

The World Bank estimates that 70% of women-owned SMEs in developing countries are excluded from accessing funds from traditional financial institutions, which means that SMEs owned or led by women face a credit gap. up to $300 billion a year. This deficit is compounded by the fact that women entrepreneurs in developing countries typically face a crisis of confidence, leadership gaps and a lack of technical knowledge.

We now have a better idea of ​​what it costs, with the world Bank suggesting that SMEs owned or led by women are one-third less profitable than male-owned businesses in comparable sectors. The biases are growth and prohibition potential.

A different approach to eliminating bias is needed to bring lasting benefits to women in ways that are meaningful, measurable and scalable.

A simple equation: consider women to break down prejudice

To advance gender equality and break down biases, we must adapt investments to take into account the particular situation of women.

So what can investors do differently to break the bias? Here’s a tried and tested five-point plan.

First, reduce the size of investments to accommodate the smaller size of women-led businesses. Smaller notes have the dual benefit of reducing funds at risk for the investor while increasing accessibility for women entrepreneurs.

While reducing ticket sizes will improve accessibility, women still face lack of confidence when applying for funding. We have seen 80% of women entrepreneurs self-select without funding, mostly due to a crisis of confidence. Yet applicants don’t face the same trust barriers when the investment window is women-only. This brings us to our second recommendation: support more women-only funds, programs or investment windows.

Third, more investment is needed to help women entrepreneurs develop attractive business plans, strong financial models and entrepreneurial leadership skills. Across Africa, there remains a capacity gap in business management, usually due to lower levels of education and fewer business opportunities. African women are not short of good ideas; however, some cannot conceptualize them into robust, executable plans.

Only with the right leadership can women entrepreneurs unlock the potential of their business by investing in women’s core entrepreneurial capabilities and skills.

In fact, we have seen explosive growth in women-led businesses after they received technical assistance. For example, Virginia Sibanda, CEO of VIRL Financial Services, a Zimbabwe-based micro-financier. She received personalized support from financial and leadership advisors. As a result, Virginia and VIRL better managed the company’s financial situation. Additionally, the combination of financial advice and leadership advice has accelerated Virginia’s ability to engage potential investors from a place of trust. Virginia continues to attest that “getting the right advice changed the way I run my business, the way I lead, and set me on the path to success.”

Fourth, contract terms should be flexible depending on the realities of women entrepreneurs and their low propensity to raise matching funds or follow-on investments within stipulated timeframes.

Fifth, focusing investments on entrepreneurs and businesses that positively impact women’s economic empowerment can have a multiplier effect in reducing gender bias and increasing empowerment.

Investing in women is slow but pays dividends

The energy required to break down these biases should not be underestimated.

In recent years, there has been an increase in the number of female-led funders and funds for women-led businesses. These are all designed to ensure that women-led SMEs can access and use available finance.

However, the amounts of funds allocated remain low. As women-owned or run businesses tend to outperform the market, this lack of funding will limit Africa.

It is only through the collective will of all stakeholders to break down biases that women entrepreneurs will finally be able to operate in a conducive business environment, access affordable finance and have the skills, information and networks to succeed. ensuring that they take their rightful place in the African world. economic development path.

Victoria Sabula is the Executive Director of AECF.