In banking, operating practices are built on risk assessment. For financing to small and medium enterprises, that assessment traditionally hinges on one question: what does the client have in terms of collateral--an item of value that can be pledged as security for a loan?
For Africa's women entrepreneurs, who often face systemic barriers to acquiring property, that question typically closes the door to finance. Addressing this requires more than policy change; it means rethinking how collateral is used. Doing so is critical if Africa's banking sector is to expand access to finance and unlock the economic potential of women entrepreneurs.
At Ecobank, a pan-African banking group operating in 33 countries, this meant rethinking how financial services are designed and delivered. Carol Oyedeji, Ecobank's Group Commercial Banking Head, puts it this way: "We believe in designing solutions from the customer's perspective--what we call the 'outside-in' approach."
That approach received a boost from a partnership with the African Development Bank Group's Affirmative Finance Action for Women in Africa (AFAWA) initiative.
AFAWA's "Guarantee for Growth" mechanism covers up to 75 percent of the risk on loans to women-led businesses, which offers Ecobank space to adjust how it assesses credit applications.
With reduced risk exposure, its credit officers can focus more on business performance and cash flow rather than collateral. "The guarantee materially influences decision-making. It makes officers more open to approving loans that might otherwise be declined," Oyedeji said.
Beyond guarantees, AFAWA also provides capacity development support to partner institutions. At Ecobank, this has shaped internal processes and product development. For example, the bank introduced contract-based financing, merchant cash advances, and Ellevate, a program tailored to women-led businesses.
Ecobank client Fatima Sesay, founder of freight forwarding company Unimax in Sierra Leone, is one example of the benefits of this approach. Despite having a strong track record, Sesay faced difficulty accessing finance. Through Ellevate and the AFAWA guarantee, she secured funding based on confirmed contracts.
"When it comes to financing, I don't joke around - I use my financing for what I say it will be used for. For others, when the money comes, they forget the purpose of what it would be used for - and you need to be able to pay back the loan with interest," Sesay said.
Sesay acknowledges that her participation in the program went beyond accessing financing to build her company: "I feel that my performance contributed to breaking some of the stereotypes of women in business."
She used the funding to scale her business, taking on major contracts with the World Health Organization, DHL and other clients, which supported job creation and business growth.
To meet growing demand she purchased four trucks, hired a driver and two apprentices for each, as well as a transport manager. As a result of the Ellevate financing, Sesay's staff increased by 13 people.
Ecobank's Oyedeji notes that the bank's support for Sesay's business has grown from an initial loan of USD 5,000 to USD 40,000.
For Ecobank, the partnership with AFAWA has been fruitful. Its portfolio of women-led businesses grew from 9,400 in 2021 to more than 83,000 through the end of 2024, with lending reaching USD 265 million. The model offers a pathway for other banks. Expanding lending to women entrepreneurs, the commercial bank claims, is both a commercial opportunity and a way to drive broader economic inclusion.
In May 2025, Ecobank was named "AFAWA Bank of the Year" at the African Banker Awards, recognizing its efforts to expand access to finance.
"AFAWA's mission is to transform Africa's financial landscape to make it truly work for women," said Melissa Basque-Roux, AFAWA's coordinator. "The Guarantee for Growth partnership with Ecobank is a best-in-class example of this vision in action. Their success demonstrates the immense potential that can be realised when we de-risk lending and empower financial institutions to innovate. It shows what is possible and paves the way for us to do even more together across the continent," she added. Across the continent, the initiative has partnered with more than 200 financial institutions to channel more than USD 3.1 billion to women-led businesses.
