These are the barriers women entrepreneurs face in SA

While alternative funding avenues exist, many women entrepreneurs lack awareness of these options, exacerbating their financial challenges.

Women entrepreneurs in South Africa face significant barriers according to a new research study. These barriers include access to business knowledge, education and training programmes, access to finance, access to profitable markets, compliance requirements, bureaucracy and administration and access to women’s networks or support structures.

The Competition Commission conducted a comprehensive research study on the challenges that women entrepreneurs encounter in their pursuit of entering and effectively participating in markets. Apart from the main barriers identified, the study also revealed that social factors such as safety, societal norms, customary practices and domestic responsibilities affect the ability of women to move freely and dedicate time and energy to perform their entrepreneurial activities.

The study, titled “Promoting Effective Entry and Participation of Women Entrepreneurs in the South African Economy”, was done to extend the commission’s efforts to enhance historically disadvantaged individuals’ meaningful participation in South Africa’s economy as required by the Competition Act.

It also investigated the strategies that women entrepreneurs are adopting to overcome these gender-specific barriers to entry and participation.

The study features insights from surveyed female entrepreneurs and stakeholders, including the Businesswomen Organisation, the Johannesburg Chamber of Commerce and Industry, the Commission for Gender Equality and the Department of Women, Youth and People with Disabilities.

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Government and NGOs must act

The commission says the findings underscore the urgent need for concerted efforts from government and non-government stakeholders to enhance the effective implementation of the existing frameworks and initiatives aimed at empowering women entrepreneurs.

The study also highlights some of the key pro-competitive principles that government and non-government stakeholders can adopt to support and promote the entry and meaningful participation of women in the broader economy as the cornerstone of inclusive growth and sustainable development.

By aligning their efforts and resources, both sectors can pave the way for equal opportunities and ensure the success of women entrepreneurs throughout South Africa, the commission says.

The research also found that women have a problem to access formal funding mechanisms because they have no land, property, or other assets required as collateral by lending institutions. Consequently, women entrepreneurs are forced to seek financial support from informal sources like family, friends, social clubs and even loan sharks.

 In addition, the study identified the multifaceted impact of limited access to resources, domestic responsibilities and the complexity of compliance requirements women face. These factors collectively diminish the ability of female entrepreneurs to establish a foothold and thrive in lucrative markets. 

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Domestic responsibilities hold women entrepreneurs back

Domestic responsibilities are particularly pronounced in rural and semi-urban areas and also contribute to the struggles women entrepreneurs face in accessing profitable markets.

On a positive note, the study highlighted the catalytic role of women networking structures in empowering women entrepreneurs. These networks facilitate the dissemination of crucial information, provide access to valuable resources, connect entrepreneurs with potential customers and offer mentorship opportunities from more experienced counterparts.

However, the research also exposed the challenges of affordability and accessibility of these structures, particularly in rural and semi-urban regions.

The commission says the study ultimately underscores the pressing need for holistic support and promotion of female entrepreneurs in the economy.

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