Imagine driving sustainable growth, unlocking untapped economic potential, and making a profound societal impact—all through equitable access to finance for women. Iveta Tancheva-Nikolova, Director at Finance in Motion explores how unlocking gender-Inclusive finance leads to smart investing for sustainable growth.   

Equitable access to finance for women is a game-changer for sustainable development and economic prosperity. McKinsey & Company’s 2024 study highlights that companies with more women in management are 39% more likely to be profitable. At Finance in Motion, we are committed to promoting gender finance, recognizing its critical role in fostering inclusive growth.

Yet, achieving gender parity is far from over. The latest Global Gender Gap Report 2024 by the World Economic Forum reveals that full gender parity is still five generations away. In the Middle East and Northern Africa (MENA) region, the disparity is even more pronounced, with limited financial access for women costing the region $575 billion annually, according to an IFC and UN Women report.

For private investors, this represents a unique opportunity: investing in gender finance is both socially responsible and economically advantageous.  

The Power of a Systematic and Long-term Approach 

To drive sustainable change in gender finance, a combined approach that integrates investments and policy work is essential. Building ecosystems that support women entrepreneurs and promote gender equality in financial systems is critical.  

Through the SANAD Fund for MSMEs exemplifies this transformative power, having significantly supported over 20,000¹ women entrepreneurs through capacity building in the MENA region over the past 13 years. This demonstrates that strategic investments in gender finance yield substantial returns. 

Defining the Problem and Tailoring Investment Strategies

Understanding a region’s specific gender finance challenges is key to unlocking substantial opportunities. In MENA, where female labor participation is among the lowest globally, creating job opportunities for women has a transformative economic impact.

The SANAD Fund’s strategic lending and equity investments to financial institutions in MENA have supported 131,000² jobs for women across various sectors. Targeted advisory services enhance these institutions' capacity to serve women in business, showcasing successful female entrepreneurs and driving systemic change within the sector.

In more gender-balanced markets, the focus shifts to high-impact sectors like technology, finance, and leadership roles. Here, targeted investments can promote female entrepreneurship and leadership, creating high-quality jobs and driving significant economic growth. For private investors, this means tapping into a market with enormous potential for both financial returns and social impact. 

Knowledge is Power – Maximizing Returns through Strategic Gender Investments

By focusing on comprehensive capacity-building, investors ensure that financial institutions can better meet the unique needs of women in business. This dual approach—empowering both the lenders and the borrowers—creates a robust ecosystem where women can thrive.

Unlocking Potential Growth through Gender-Inclusive Investments

For private investors, the gender finance gap represents not just a social challenge, but a significant investment opportunity. By directing capital towards gender-inclusive finance, private investors can tap into an underutilized market, driving both returns and meaningful impact. Investing in women entrepreneurs and gender-smart financial products through blended finance funds isn't just good ethics—it's good business, as it unlocks untapped growth opportunities, allows for diversification and attractive risk protection for private investors.

Blended finance funds, like the SANAD Fund, show how strategic investments in gender inclusion can unlock economic benefits. With a focus on sustainable change and ecosystem development, these funds pave the way for robust, scalable opportunities in emerging markets.

Private investors have the opportunity to be at the forefront of this transformative movement. By supporting initiatives that foster gender equality, you contribute to social progress and position yourself to reap the rewards of a diversified and resilient portfolio.

Read more in our SANAD Fund for MSMEs 2023 Impact Report how we are “Addressing the Gender Finance Gap in the Middle East and North Africa.”