Loans and Gender

In both Sierra Leone and Tanzania, women are utilizing loans from VSLA groups.  Women account for the majority of start-up loans and business loans in Sierra Leone (92%),  and the majority of home improvement loans (57%) and loans for personal reasons (100%) in Tanzania.  Although agriculture loans are typically utilized by more men than women, research from CRS and Floresta indicates that this gap is decreasing, particularly in Tanzania where the percentage of men and women taking out agriculture loans is equal.

Another interesting finding relates to loan utilization of household food loans. It often believed in African rural settings that men are the sole providers of household food and women only prepare what is provided by men. The loan utilization study of SILC groups in Sierra Leone demonstrated something different. With 42 percent of household food loans taken out by women, this suggests that women are providing food for their households.  More details on the results from CRS and Floresta can be found below.

Sierra Leone Results

  • In Sierra Leone, women account for 62 percent of the business loans in SILC groups. The option to take out smaller loans for business purposes may account for the large numbers of women accessing these types of loans.

  • Significantly, 39 percent of agricultural loans are taken out by women in Sierra Leone for an activity that is typically dominated by men.

However, it is interesting to note that in Sierra Leone men and women often utilize agricultural loans for different purposes. Men typically use their loans to buy improved seed varieties of staple crops such as rice, while women use their loans to buy seeds for vegetables, onions, tomatoes, cabbage, groundnuts and beans – crops more often cultivated  and managed by women. In addition, men often use agricultural loans to hire labor to rehabilitate their plantations while women hire labor for brushing their plots and digging.

  • Women took out 92 percent of start-up loans. These loans (typically $10 – $15 per individuals) are often used by women to start small businesses selling agricultural produce such as bananas, palm oil, rice, and groundnuts.

  • Women also utilize health loans more frequently than men. This may be due to the fact that women are more likely to take care of children and other family members who get sick, as opposed to men.

Tanzania Results

Floresta’s findings indicate that women take out more loans for home improvements and personal reasons than men. However, similar proportions of men and women take loans for business, education, health, and agriculture. Most beneficiaries utilize business loans for microenterprises, such as tailoring, as well as livestock, fruit and animal feed businesses. Profits from these small businesses are often used to purchase food for the household.

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