Abstract
The research is financed by BA ISAGO University, P.Bag BR94, Gaborone, Botswana Abstract The study seeks to investigate the causes of financial management challenges faced by women-run SMMEs in Gaborone, Botswana; given the background that the Government has established agencies and initiatives that support this sector financially and provide advisory services. Ways of mitigating the established challenges were suggested. Women entrepreneurs contribute immensely to Botswana’s economy. The Government of Botswana, in its bid to assist economic diversification and citizen empowerment, had several programs to support SMMEs including Business Botswana and Women In Business Association (WIBA). These provide funds and business advisory services to women-run SMMEs. Research has shown that 80% of SMMEs in Botswana fail in the first 3 - 5 years of the establishment phase. Preliminary reviews of literature disclosed that poor financial knowledge proves a real obstacle to most of the small women-run business. This includes insight and skill on what to do when a payment is received, how to manage that money, and investment strategies for growth. The researchers used desktop research and questionnaire surveys. The sample was 41 women-run SMMEs in Gaborone and non-probability convenience was used to sample the women-run SMMEs. Most women entrepreneurs are not looking for external funding, which is an issue of concern to policy makers for women businesses that contribute significantly to the economy. Lack of basic financial management and record keeping skills are affecting women, hence relying on very minimal internally generated funds. Financial institutions and the government should encourage women in business. Keywords: SMMEs, SMMEs finance providers, Financial Management challenges DOI: 10.7176/RJFA/11-14-14 Publication date: July 31 st 2020
Highlights
The study seeks to identify the financial management challenges faced by women-owned SMMEs (Small, Medium and Micro Enterprises) in Gaborone, Botswana
The Government of Botswana designed quite a number of programmes to assist SMMEs financially and to offer business advisory services since it recognizes the importance of the informal sector/SMMEs to the country’s economy (BIDPA, 2007)
The Department supports the implementation of the “Women Entrepreneurship Development (WED) Programme”, an international cooperation initiative which aims to boost growth of women-owned businesses
Summary
The study seeks to identify the financial management challenges faced by women-owned SMMEs (Small, Medium and Micro Enterprises) in Gaborone, Botswana. According to Nyamwanza et al (2012), women entrepreneurs in general, find it difficult to manage their profits Most of their businesses make profits but they do not reinvest their money in the business, and this is www.iiste.org evidenced by the lack of growth in the majority of the businesses they surveyed. Among the challenges normally faced by women-run enterprises, 80% admitted that access to finance is a major obstacle for growth of womenowned businesses while more than 36% were not sure if they have all the information required in order to get a loan. The fact that they did not know that promotion and advertising expenses form part of a business’ expenses say a lot about their basic knowledge of bookkeeping This may explain a high rate of failure of female run enterprises due to lack of reinvestment of funds for business growth
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