Micro and small enterprises (MSEs) are the economic backbone of most economies worldwide, increasing employment and reinvesting in local communities. In emerging markets, there are 365-445 million micro, small, and medium enterprises. However, 80% of women-owned small businesses with credit needs are either unserved or underserved, representing a $1.7 trillion USD financing gap.
CARE’s Ignite program, launched in partnership with the Mastercard Center for Inclusive Growth, focused on supporting micro and small enterprises, especially those led by women, in Pakistan, Peru, and Vietnam between 2020 and 2023.
Ignite took a market-based approach to service delivery that was sustainable and scalable by working with over 35 local partners across the three countries, 11 of which were core service delivery partners. These partnerships opened up much-needed access to financial and digital resources, while building entrepreneurs’ business capacity and networks.
Ignite set out to reach 3.9 million entrepreneurs in three years with $5.26 million USD in grant funding from Mastercard. The program exceeded initial goals, reaching more than nine million entrepreneurs, and unlocking access to $154.9 million USD in loans. More than 150,000 entrepreneurs were deeply supported with loans, critical support services, and training.
The commercial value in supporting women-led MSEs is irrefutable. Global data continues to show this and, together with Ignite financial service provider partners, CARE has proved it. Despite this, gender bias continues to permeate throughout financial institutions the world over. CARE is calling on all financial service providers to read the proof in this report that women are better financial clients, to support the drive for 100% financial inclusion for women, and to invest in reaching this goal.
Through Ignite, 51% of program participants received a business loan for the first time, with 10% going on to access a second loan. 81% of entrepreneurs increased their sales and 92% applied what they had learned through Ignite training. Repayment rates on loans were high, with 100% repayment on one loan product in Pakistan. 90% of participants said that their quality of life had improved since participating in the Ignite program.
68% of Ignite participants were women (95% in Vietnam, 99% in Peru). 79% of women reported that Ignite had supported them to achieve their business goals. CARE also saw an 81% reduction in stress levels amongst women who participated in Ignite. 83% of women are now using digital tools and services in their businesses, and 79% say digital tools and training had helped their businesses grow.
Four key Ignite learnings
- Women-centered design is critical to creating effective and demand-driven products for women-led enterprises.
- Strategic and targeted outreach campaigns are effective at: driving customer awareness and uptake, influencing the MSE ecosystem, and addressing restrictive norms.
- Strategic and diverse partnerships enable programming to reach more women and makes delivery of products & services more sustainable.
- Even after successful interventions, strong demand remains unmet, and women continue to face multiple barriers.
CARE’s next steps
Codifying learnings to support replication: CARE will continue to follow the impactful Ignite model and share its learnings with others within the MSE ecosystem, so that these holistic interventions on intentionally serving women entrepreneurs can be replicated.
Supporting the financial health of women-led MSEs: CARE will continue to work with its partners to co-design and deepen the range of financial products and services for women-led MSEs, so that women can better manage the financial health of their businesses, and financial service providers can grow their portfolios of products and services.
Promoting green business in a time of climate crisis: CARE will explore how to support women to build climate resilient and sustainable businesses and work with local partners to increase female representation in the green business sector.
Building inclusive ecosystems: CARE will convene stakeholders in the MSE space to create strong and strategic public-private partnerships within the ecosystem, leading to better outcomes for entrepreneurs.
Shifting gender norms: CARE will explore locally led solutions to gender norms barriers, continue to deliver campaigns challenging these norms, and deepen programming to overcome some of the bespoke barriers that women face.