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Gendered Lending Practices: Enabling South African Women Entrepreneurs to Access Start-Up Capital

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  • Evelyn Derera

    (School of Management, IT & Governance, P Bag X01, Scottsville, Pietermaritzburg, University of KwaZulu-Natal, South Africa)

  • Pepukayi Chitakunye

    (School of Management, IT & Governance, P Bag X01, Scottsville, Pietermaritzburg, University of KwaZulu-Natal, South Africa)

  • Charles O'Neill

    (School of Management, IT & Governance, P Bag X01, Scottsville, Pietermaritzburg, University of KwaZulu-Natal, South Africa)

  • Amandeep Tarkhar-Lail

    (University of Bedfordshire, University Square, Luton, Bedfordshire, UK)

Abstract

This study explores gendered lending and marketing practices of start-up capital to women entrepreneurs in South Africa. A multi-method research design, comprising of 6 in-depth interviews with experts, and a survey of 50 women entrepreneurs was adopted using convenience and snowball sampling techniques, respectively. The findings revealed that women entrepreneurs are experiencing gendered discriminatory practices embedded in lending practices used by financial institutions, thereby discouraging them to venture into non-traditional industries. Whilst financial providers may know their products well, many emerging women entrepreneurs in South Africa may find it difficult and costly to obtain information on the thousands of financial products available. Hence, women entrepreneurs resort to taking greater risks than necessary in order to get their businesses off the ground. Educating women on financial matters is extremely important if South Africa is to benefit fully from the untapped entrepreneurial talent that women possess. The study adds voice to the discriminatory lending practices faced by women entrepreneurs in developing countries. Future research could explore the feasibility of establishing a financial institution which caters specifically for the needs of women.

Suggested Citation

  • Evelyn Derera & Pepukayi Chitakunye & Charles O'Neill & Amandeep Tarkhar-Lail, 2014. "Gendered Lending Practices: Enabling South African Women Entrepreneurs to Access Start-Up Capital," Journal of Enterprising Culture (JEC), World Scientific Publishing Co. Pte. Ltd., vol. 22(03), pages 313-330.
    • Handle: RePEc:wsi:jecxxx:v:22:y:2014:i:03:n:s0218495814500137
    DOI: 10.1142/S0218495814500137
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    References listed on IDEAS

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    1. Beck, Thorsten & Demirguc-Kunt, Asli & Soledad Martinez Peria, Maria, 2008. "Bank Financing for SMEs around the World: Drivers, Obstacles, Business Models, and Lending Practices," Policy Research Working Paper Series 4785, The World Bank.
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    Cited by:

    1. Waseem Ul Hameed & Muhammad Haseeb & Jawad Iqbal & Leonardus W. W. Mihardjo & Kittisak Jermsittiparsert, 2022. "Environmental disaster and women self‐sustainability—A survey study on microfinance female clientele in Pakistan," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 27(3), pages 3599-3622, July.
    2. Ojong, Nathanael & Simba, Amon & Dana, Leo-Paul, 2021. "Female entrepreneurship in Africa: A review, trends, and future research directions," Journal of Business Research, Elsevier, vol. 132(C), pages 233-248.
    3. Paola Paoloni & Giuseppe Modaffari, 2018. "Female-Owned Innovative Startups in Italy: Status Quo and Implications," Administrative Sciences, MDPI, vol. 8(4), pages 1-31, October.
    4. Ibrahim Said & Christine Enslin, 2020. "Lived Experiences of Females With Entrepreneurship in Sudan: Networking, Social Expectations, and Family Support," SAGE Open, , vol. 10(4), pages 21582440209, October.

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