Launch of Zim women’s bank - a milestone

We hope that the establishment of the women’s micro-finance bank will help address inequalities in accessing labour market, accumulation of assets and access to basic services, among others.

ALLOW me from the outset to express the United Nations’s regret over the explosion incident that took place last weekend during a ZANU-PF rally in Bulawayo where the President was present. The United Nations condemns the act of violence. The UN Secretary-General even issued a statement and I quote in part: “The Secretary-General condemns such acts of violence and calls for the perpetrators to be brought to justice. He wishes the injured a quick recovery.”

Let me also congratulate the Government of Zimbabwe for this big milestone and achievement of establishing the first women’s bank. Makorokoto, amhlophe.

With only 27 percent of women having access to formal banking products and accounting only for 10 percent of total bank loans, a dedicated microfinance bank for women can significantly contribute to the empowerment of women.

We are proud to have been partners in this important process along with the Ministry of Women Affairs, Gender and Community Development, the Ministry of Finance and the Reserve Bank of Zimbabwe.

The opening of the Zimbabwe Women’s Micro-finance Bank, under the theme “Leaving No one Behind,” resonates well with the global, regional and national development priorities and context, attuned to ongoing global commitments towards sustainable development goals and achievement of gender equality.

I am sure this initiative will go a long way in facilitating women entrepreneurship, self-employment, creating job opportunities and breaking the vicious cycle of poverty.

The launch of the micro-finance bank will also greatly complement the global Spotlight initiative by the UN Secretary-General and the European Union to end violence against women and girls.

The multimillion-dollar initiative includes Zimbabwe among other 22 countries in recognition of Zimbabwe’s strong partnership with UN and development partners to achieve gender equality. The bank will go a long way, in this regard, as economic emancipation surely will contribute to women’s social and political emancipation.

Empowerment of women is a human right and equality issue, consistent with the UN Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW) and the Sustainable Development Goals.

The values of gender equality are enshrined in Zimbabwe’s progressive Constitution. This is smart economics and a good business case too. I also admire the people of Zimbabwe including parliamentarians and civil society across the socio-economic and political divide, who have been pushing in solidarity for the establishment of a women’s bank.

The far-reaching ramifications of marginalising women go far beyond women, with dire consequences to the present and long-term human development. In addition to other underlying factors, there is considerable evidence that gender inequality plays a significant role in the slow growth performance in many developing countries.

According to the UNDP Africa Human Development Report 2016, Sub-Saharan Africa loses around $95 billion a year due to gender inequality, jeopardising the continent’s efforts for economic growth and development. The loss is equivalent to six percent of the country’s Gross Domestic Product (GDP). In 2014 alone, the losses peaked at $105 billion.

Some of the reasons cited in the Africa Human Development Report 2016 for this loss include deeply rooted structural obstacles like unequal distribution of resources and political power, capped with social institutions that sustain inequality, which are holding back African women, and the continent. Africans will fail to meet their poverty reduction targets unless gender inequality that has proven to be costing billions of dollars is tackled.

We hope that the establishment of the women’s micro-finance bank will help address inequalities in accessing labour market, accumulation of assets and access to basic services, among others.

According to the World Bank, globally, about two billion adults, majority of them women by far, remain unbanked — without an account at either a financial institution or through a mobile money provider.

Under these circumstances, offering specialised banking services specifically targeting women is becoming a viable option for empowering women. Well-known Grameen Bank in Bangladesh, a pioneer in micro-finance with a new concept targeting women, was established in 1983.

In Africa, countries such as Ethiopia and Rwanda are investing more in women and youth empowerment strategies including special banks and services. Ethiopia’s first Women‘s Bank, ENAT, was established in 2013 with most investments coming from women and run by women. The W-initiative by Access Bank in Rwanda connects and empowers women in business across the continent.

The Malaika Women’s Account is designed exclusively to suit the financial requirements and lifestyle of women. Zimbabwe is therefore on the right path.

The success and sustainability of the bank will be hinged upon, amongst others, continued observance of good corporate governance, accountability and transparency. As we move onto the next development stage it is paramount to observe the standard banking practices and norms under a strong set of banking regulations to ensure their financial health.

A hybrid of lessons drawn from Africa and Asia in the Zimbabwe Women’s Micro-finance Model, will help in the adaptation and modifications of financial products to the country context, targeting key economic sectors such as agriculture and mining.

The inclusive approach already adopted, targeting women at various entrepreneurial levels including at the very micro level, where most women, majority in the remote rural areas, are concentrated is very commendable.

Lack of collateral is a key constraint to accessing financial services by women. I am glad to see that the bank has put in place extraordinary measures to manage this hurdle. It is only through eliminating such barriers and reaching out to the furthest in remote areas that we can achieve our goal of LEAVING NO ONE BEHIND.

The UN and its development partners are actively engaged in empowering women holistically through various programmes including sustainable livelihoods, resilience building and social services such as health and education, eliminating violence and harmful practices.

Before I conclude, I also want to emphasise the critical importance of getting the formal financial institutions to reach out to women in a big way by eliminating barriers such as collateral requirements. This might require changing inheritance laws, co-sharing risks with spouse and other innovative means as well as adhering to good banking governance practices.

Let’s put our heads together, to make this happen. I wish the Zimbabwe Women ‘s Microfinance Bank a successful journey in its endeavour to empower women through enhanced financial inclusion. Once again congratulations. Speech delivered by Bishow Parajuli, the UN Resident Coordinator in Zimbabwe, at the launch of the new Zimbabwe Women’s Micro-finance Bank