Making Capital Work for African Women: Closing the gender financing gap alongside the African Development Bank Group

By Carmel Kistasamy, Sector Head: Development Finance, Absa CIB

Busisiwe Mdletshe no longer sees herself as a small business owner. She is a capable, strategic chief executive. But she didn’t always feel this way. 

Mdletshe currently spearheads an elite team of chartered accountants, tax experts, financial advisers, and business strategists as part of the financial services provider she founded and continues to scale: NetVest.  But to create such a stable, thriving business, and to have the confidence to recognise her status as an executive, entrepreneur, and leader in South African finance, she acknowledges the need for continued investment – and not just financially. 

Naturally, the support of a targeted loan and a flexible overdraft facility has played a crucial role in supporting the business’ working capital needs, ensuring operational stability during critical times. But more importantly, this financing gave her the freedom to pursue critical skills development training offered alongside the economic support. 

Graduating from the Fetola’s Emerging Entrepreneurs Mentorship Programme and the International Executive Leadership Programme at the Frankfurt School of Finance and Management has equipped her with executive level skills that are redefining her business operations. Now the business is seeking larger clients, more complex projects, and becoming more competitive in an already competitive industry. 

Ultimately, Mdletshe’s success story is a part of a global movement to close the gender financing gap. In 2023, the World Economic Forum (WEF) estimated that the global financing disparity for women-run small and medium enterprises (SMEs) was $1.7 trillion, despite the fact that at the time, an estimated 32% of all SMEs are run by women. Since 2006, WEF has released its Global Gender Gap Index, examining the current state of gender parity across 146 countries – with one of the key metrics being Economic Participation and Opportunity. As we await the 2025 edition, we rely on last year’s finding, with WEF analysts noting the original gap (in terms of economic opportunity) has closed by 60.5% globally.
Meanwhile, we have seen a closure of 68.1% in sub-Saharan Africa in the same category. While this is an impressive step forward, the statistics show this is only a 0.4% increase over the previous year in the surveyed African regions, which is why it’s essential that financial institutions and governments continue to find new ways to bring capital to women-run businesses and keep up the momentum. 

But why is investing in women and their businesses so important? It’s been repeatedly proven (and most recently reiterated by European Investment Bank) that closing the gender financing gap ultimately benefits everyone: triggering greater, more inclusive economic growth, more stable communities, and better governance. 

Each year, the African Development Bank (AfDB) annual meeting attracts fellow Development Finance Institutions (DFIs), central banks, private banks, academics, heads of state, and others in the finance sector to discuss ways to grow African economies and transform lives. This year, the theme is Making Africa’s Capital Work Better for Africa’s Development, with the goal to identify ways to enhance all forms of capital, human, natural, financial, and commercial. 

This well-rounded understanding of capital is essential to Absa’s strategy in bolstering African SMEs. As we’ve learned from our client – like Busisiwe Mdletshe – it is essential that economic capital isn’t the only priority. To enable SMEs, the businesses that are crucial to developing Africa’s economic and social prowess, you need an equal focus on human capital – from skills development of the entrepreneur to offering advisory capabilities to maximise their business’ returns. It is this holistic approach that brought us together in a landmark partnership with the AfDB, executing a transformative multibillion-rand financial package aimed at increasing funding for underserved segments across the continent – with a clear focus on the development of women lives and livelihoods. 

The first aspect of this package is a sustainability-linked Tier 2 loan to the value of R1.7 billion, complemented by a non-financial support package of R18 million specifically for capacity building and technical assistance for youth and women-run enterprises. With an initial aim to reach 6000 businesses in the next few years, we are well on our way to exceeding this number based on our current projections. 

Similarly, the AfDB partnership also saw the launch of a subscription of R1 billion into Absa’s inaugural social (Tier 2) bond issuance, with proceeds earmarked for providing affordable housing loans to female homeowners. The initiative has shown strong early success, as our team has achieved 59% of the R2 billion affordable housing for women target, with 66.4% of our affordable housing loans issued in 2025 to date benefiting women. 

We hope that such a landmark project exemplifies how DFIs like the African Development Bank Group and private financial institutions can work together to bring about a shared goal. DFIs must reach the widest number of people, and private banks have the infrastructure, monitoring capabilities, and on-the-ground expertise to ensure the right individuals and businesses benefit. 

Our Kenya team is also working with another Pan-African DFI, the African Guarantee Fund, and financing platform Melanin Kapital, to provide hundreds of SMEs in the country with sustainability training, capacity building, mentor matchmaking, and networking activities alongside financing opportunities. This is all in a bid to prepare them to access further credit while growing their businesses sustainable. 

Such collaborations are at the core of our new pledge: Absa’s Regional Operations plan to secure finance of $10 billion – approximately R180 billion – for women enterprises by 2035. 

But we’re far from the only institution making strides to support African SMEs, such as the recently announced multinational partnership between Equity Group Holdings and the African Guarantee Fund. This $500 million framework aims to accelerate SME funding across East and Central Africa, with a focus on women and youth-led businesses. Meanwhile, the Bank of Industry in Nigeria and the AfDB announced late last year, a new $50 million financing agreement for women-led enterprises that offers financial and business advisory assistance. 

If projects like these can inspire other private institutions to join the cause, together we can close the financing gap. And if we can help enable more leaders like Busisiwe Mdletshe, everybody wins.