In this Issue: Spotlight on Financing WMSMEs
This month we’re delighted to announce the winners of the Alliance’s 2025 Hackathon, our most competitive fintech Hack to date with 11 finalists selected to pitch out of more than 200 applicants.
First prize was awarded to Pilou, a digital savings and investment platform led by women, for women. In Latin America just one percent of women have an investment account and Mexico based Pilou, takes women on a customer journey that builds their financial capabilities and trust before offering personalized consultations to guide them through their investment choices. The judges were impressed by the careful attention paid to each step of the sales funnel to make it work for women. Pilou’s founder and CFO Patricia Florencia says the Hack provided valuable insights and connections that will enable Pilou to scale.
Second prize went to DREX, a climate-tech in Ecuador with an innovative model which links women-owned businesses with women-owned solar farms covering up to 100 percent of their energy requirements.
Futa was awarded third prize, and is a lending and payments platform for women-owned small to medium-sized enterprises (WSMEs) in Francophone Africa. As Co-Founder and CEO Grace Jerolgan explains, Futa uses WSME payroll data to offer their employees fast and fair access to financing, addressing urgent financial needs efficiently. This also allows Futa to build a better understanding of the WSME’s business performance, which in turn facilitates their access to larger loans from Futu.
Our annual Hack again demonstrated its value in encouraging more fintechs to tap into the female economy. Many of our Hack graduates are featured in our quarterly Fintech Fridays Series. You can tune in to our last session to hear from Pilou, Shecluded, and TymeBank on how they’re adapting their sales funnels to recruit more women customers. Our next Session on October 25 will focus on fintechs financing WSMEs.
As we all know, there are many supply and demand side constraints to financing WMSMEs, particularly in Sub-Saharan Africa as mapped out in this important paper by The Bill & Melinda Gates Foundation. A key point made in the paper is that ‘nano loans’ are now the main digital credit product available but, given they are expensive and for very small amounts, they are not useful for business purposes. They have also taken share from microfinance providers (MFPs) who did not emphasize underwriting methodologies that ensure lending is for productive purposes. For some MFPs this has resulted in a gutting of valuable revenues and an WMSME market at the lower end, left dramatically underserved.
Moving up business size, while fintechs are picking off pieces of the SME lending equation and helping banks to underwrite more efficiently, we obviously need more fintechs and neobanks to lend to WMSMEs at scale. In one of three pieces of research conducted by the Alliance into fintechs and the female economy, we outlined ways fintechs have adapted their sales funnels to bring more women through. Worth a read.
Banks are and will remain core lenders to SMEs. However many in emerging markets favor lending to governments which is low risk and high return rather than lending to small businesses. We need to look at aligning incentives and work on convincing senior bankers that there is a great business opportunity if we are to truly close the gap in finance to WMSMEs. For this reason, next month we are launching a four-part Primer on the Strategic and Business Case for WMSMEs, as part of our support of the WE Finance Code global rollout. The Primer will tackle the main steps to developing a commercially viable WMSME strategy featuring expert practitioners from Alliance members around the world. The Primer series, open to members and non-members, will take place over four weeks from October 31 and is highly recommended for all those signing up to the Code. Apply here.
Finally, thank you to the judging panel and to all finalists in our Hackathon for making it the best Hack yet.
In community,
