IFC, a member of the World Bank Group, has released a new report titled COVID-19 and Women-Led MSMEs in Sub-Saharan Africa: Examining the Impact, Responses, and Solutions.
The study focuses on understanding how the COVID-19 pandemic has affected Micro, Small, and Medium Enterprises (MSMEs), especially those led by women, through a survey of 13 African countries. The survey found that over a quarter of all of these businesses were unable to continue operating during the crisis. Additionally, over half of the businesses needed to adapt their business models to continue operations, and almost 90% faced revenue losses.
Small businesses across all of the countries surveyed encountered similar economic effects caused by the global pandemic. When gender is overlaid on the data collected, the report revealed that women-led small businesses have experienced worse impacts than those led by men. This was largely attributed to their smaller size and higher concentration in heavily affected sectors.
Key highlights from the report include
- Over 90% of MSMEs across sub-Saharan Africa are suffering harsh economic impacts due to the COVID-19 pandemic, majority of them being women-owned.
- Women-led MSMEs in Africa entered the pandemic with lower rates of financial inclusion than male-led MSMEs, and the pandemic exacerbated these trends. Among the 13% of MSMEs that accessed financial support during the crisis, fewer were women-led MSMEs.
- Despite challenges posed by the pandemic, over 90% of MSMEs still plan to maintain or expand their businesses over the next 6-18 months. In line with this goal, over 80% of MSMEs expressed the need for support, particularly for growth capital and expansion assistance, during the recovery.