Setting Up Business Hubs for Rural Women Entrepreneurs

Written by Asia Elsner

This article was originally posted on the SNV blog by Tran Tu Anh, Programme Manager, Climate Smart Agriculture and Gender, SNV

By providing information and advice on business start-up procedures, available resources of finance, technology and manpower and in some cases office space and facilities at a low rent, business hubs can support women-led start-ups through the tricky early stages. In many cities around the world, business hubs are popping up and providing support to (especially young) women to kick-start their own businesses. However, in rural areas business hubs are less frequently seen. In addition, most existing business hubs do not take gendered differences in terms of access, barriers and opportunities into account.

What types of services could support rural women in the start-up and development of their business? Who will run/host a rural business hub? And how will it be financed?

These questions are currently being explored by the programme team of the ‘Enhancing Opportunities for Women’s Enterprises’ programme. The programme is being implemented between 2016 and 2020 in Kenya and Vietnam with funding from the Ministry of Foreign Affairs of The Netherlands under the ‘Funding Leadership and Opportunities for Women’ (FLOW) Framework. In Vietnam, the FLOW/EOWE programme aims to boost women entrepreneurship in four disaster-prone provinces. The programme supports female farmers and entrepreneurs through trainings on climate-smart agricultural practices, value chain development, business management and leadership, and access to resources and markets.

To ensure scale and sustainable business support for rural women in the provinces, the programme is developing a strategy and plan to establish rural business hubs in partnership with local economic and agriculture departments. The business hubs are planned to be linked with the recently launched nation-wide Women Start-up Programme, led by the Vietnam Women’s Union.

In March 2018, key staff members of the FLOW/EOWE team, together with the Vietnam Women’s Union, paid a working visit to a Business Start-up Support Centre (BSSC) for youth in Ho Chi Minh City, to learn from an existing urban model, exchange ideas, and to discuss a potential collaboration to promote business start-up among youth and women. The BSSC Vice Director, Ms. Tuong Vy, introduced the operation and achievements of the centre and also shared key lessons on how to run an urban business hub for youth. The business centre in Ho Chi Minh City has mobilised funds from different sources, including a Government Trust Fund and investment funds from financial institutions and the private sector. The BSSC works with a win-win match making system to link creative and unique ideas of young entrepreneurs with existing businesses. A list of all the ideas and a list of existing businesses and their mandate are accessible by both parties in order for them to pro-actively find a match. When there is a match, the new business initiatives get funds without interest, and vice versa existing businesses have their shares in these new enterprises.

EOWE programme team at the urban Business Start-up Centre (BSSC) for youthEOWE programme team at the urban Business Start-up Centre (BSSC) for youth

The business centre also provides loans for youth to start-up their business with interest rates ranging from 0.6 – 0.8%/per month, depending on the business sector. Approximately 70% of the loan interest is used to cover the operation and services costs of the business centre. The Vice Director explains that there is a very low rate of bad debts, because the loanee has to provide a list of their relatives, who agree to sign a repayment commitment contract to repay the loan in case the loanee cannot manage it.

In the upcoming months, SNV will cooperate with BSSC to provide a series of start-up business courses for the key players involved in the establishment of rural business hubs in the four provinces where the FLOW/EOWE programme is being implemented. The training aims to equip the key actors, including the Vietnam Women’s Union from different levels (provincial, district, commune), with necessary knowledge on business start-up activities and the operation of a business hub.

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