New We-Fi financing to enhance support for women-led SMEs in Viet Nam and Pacific
The Asian Development Bank (ADB) has received US$20.2 million from the Women Entrepreneurs Finance Initiative (We-Fi) to support women-led small and medium-sized enterprises (WSMEs) to access critical financing and training in Viet Nam and the Pacific.
The grant – the second that ADB has received from We-Fi – will finance the Women Accelerating Vibrant Enterprises in Southeast Asia and the Pacific (WAVES) programme, which aims to promote inclusive and sustainable growth and development through women’s businesses and entrepreneurship. Approximately 5,000 women-led SMEs from Viet Nam and the Pacific will benefit from the 5-year programme.
“Women’s businesses have a crucial role to play in the Asia Pacific region’s efforts to achieve inclusive and sustainable development, but social and economic barriers will have to be addressed for women to realise this potential,” said ADB Social Development Specialist (Gender and Development) Keiko Nowacka.
“For ADB, We-Fi is an opportunity to help accelerate progress on gender equality and challenge the entrenched status quo that prevents WSMEs from flourishing.”
Women-led businesses comprise about 60 per cent of all micro, small, and medium-d enterprises in Asia and the Pacific. However, these enterprises face capital constraints, which hamper their growth and development, while the women heading these businesses have limited access to business training and to targeted government support. The WAVES programme will address these constraints by focusing on the three areas of WSMEs’ development – access to finance, capacity development, and enabling environment.
The programme will improve WSMEs’ access to finance through innovative financial approaches including performance-based pricing in Viet Nam and the first gender bond in the Pacific. This is important given that Asia and the Pacific has one of the largest global SME financing gaps, with 59 per cent of the gap attributed to credit constraints faced by WSMEs. In Viet Nam, the gender financing gap is estimated by the International Finance Corporation to be at $1.19 billion.
National partners including Government agencies, civil society organisations, and women’s business associations, meanwhile, will be mobilised to support the design and implementation of gender-responsive regulations, policies, and action plans to foster a more conducive environment for women-led businesses to thrive and expand.
The WAVES programme will focus on capacity development of women through financial literacy and business acceleration programmes, mentorship, and networking opportunities, with a view to equip them with the necessary skills to run and expand their enterprises. Last, WAVES will contribute to strengthening evidence and data on WSMEs in order to better inform policies and interventions moving forward.
In April 2018, ADB received a $12.6 million grant from We-Fi to promote women entrepreneurs in Sri Lanka. ADB has been investing in women’s entrepreneurship in the Asia and Pacific region, as part of its commitment to advancing women’s economic empowerment, which is one of the operational priorities of its newly adopted Strategy 2030. By 2030, it is expected that 75 per cent of all ADB projects will promote gender equality.
We-Fi is governed by 14 founding contributing countries and is managed by the World Bank. It aims to mobilise more than $1 billion in commercial and international financial institution finance to afford women entrepreneurs access to debt, equity, venture capital, insurance products, and other opportunities to link with domestic and global markets. The aim is to improve the business environment for women-owned or led SMEs.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. In 2018, it made commitments of new loans and grants amounting to $21.6 billion. Established in 1966, it is owned by 68 members - 49 from the region.