ADB’s We-Fi grant empowering women in Sri Lanka
ECONOMYNEXT – Over 3,000 persons have benefited from the second phase of the Asian Development Bank’s (ADB) small and medium-sized enterprises (SME) line of credit project, ‘Women Entrepreneurs Financial Initiative’ (We-Fi) which began in 2018, a report said.
“Three hundred and twenty three women-owned or led SMEs employing 3,934 people have financially benefitted from the We-Fi grant,” an ADB report said.
The We-Fi grant worth 12.6 million US dollars helps catalyse further financing.
From August 2018 to April 2019, the program had used 2.9 million US dollars of the grant to mobilize a 11.5 million US dollar ADB credit line to provide debt and 6.7 million US dollars in commercial financing for equity.
Over 90 percent of the financing was for economic activities outside Colombo.
Around 22 percent of the funds were deployed in the Eastern, Northern, Sabaragamua and Uva Provinces which have lower per capita income.
One We-Fi Beneficiary is Ruchirani Munasinghe, who received an 800,000 rupee loan of which 30 percent was grant funded, to introduce better farming practices for her guava plantation in Anuradhapura.
“The ADB’s financing facility seemingly encouraged banks to smoothly process my loan application,” Munasinghe said.
She has invested in new cultivars, better irrigation systems and equipment, and is planning to reach export markets.
SMEs which benefited from the We-Fi grant were in diverse industries such as manufacturing, tourism, trade, healthcare, and agriculture.
“The We-Fi grant incentivized women to complete a comprehensive tailored training program to be eligible to receive an additional 10 percent We-Fi grant to be blended with their future bank loans.”
The report said that 504 women entrepreneurs in the agri-business sector island-wide have successfully completed training.
The key targets were to have more than 600 women-owned or led SMEs accessing finance, 700 women accessing the online networking platform and personalized business development training.
The government and industrial associations are introducing gender action plans, while partnering banks introduce new policies and banking practices to reach out to women SMEs under the We-Fi program.
The ADB project aims to improve women entrepreneurs’ access to finance, business acumen, policy frameworks and collect data on female-led businesses to create policies.
The We-Fi program is an extension of an ADB line of credit which ran from 2016 to 2018.
The first program, which provided 100 million US dollars had a target of providing 5 percent of financing to women-led SMEs.
The target was later revised to 20 percent based on high demand, and disbursements surpassed the target to 27.6 percent.
Thereafter, government requested additional financing worth 75 million US dollars for 2018–2020 due to the program’s potential.
The We-Fi program is a part of ADB’s new strategy to achieve gender equality by 2030.
In Sri Lanka female labour force participation was 33.6 percent in 2018 with low female-led businesses.
Women have struggled to scale up micro businesses, ADB said.
“These gender inequalities represent a missed opportunity to boost growth in the context of a steadily aging population and expected future labor shortage,” the report said.
A World Bank study had found that women-led businesses in Sri Lanka would require around 350 million US dollars in financing to scale up.