While some feminist thought leaders such as Chief Executive of Women’s World Banking of Ghana, Charlotte Baidoo, are calling on microfinance institutions to do more when it comes to lending to women, Root Capital is beginning a new partnership with the Australian Government to do just that.
Root Capital will partner with the Australian Government’s program, Investing in Women, to deploy $2 million AUD (approximately $1.49 million U.S. dollars) in a ten-year program to support women business owners in South East Asia. As a partner of Investing in Women, Root Capital plans to bring in private sector co-investments for women’s small and medium-sized agricultural businesses in Indonesia, the Philippines, and Vietnam.
Microfinance in general has seen a large increase in funding over the past year, with reports of a 40% surge in capital in the microfinance markets. Now, organizations like Root Capital are taking the lead in helping women enter the economy and succeed in business.
“This is a major step forward for the impact investing and agricultural finance sectors,” says Root Capital’s Founder and CEO, Willy Foote. “Together with Investing in Women, we will catalyze the growth of women-led businesses throughout South East Asia—and in so doing, will significantly improve the livelihoods of both women and men in rural communities.”
The initial investment from Root Capital will fund new loans for women in Indonesia, where the organization has had a presence for the past three years. Root Capital’s work in Indonesia has resulted in more than $23 million in loans to ten agricultural businesses, improving incomes for more than 10,000 producers.
Root Capital launched its Women in Agriculture Initiative in 2012 and has since reached more than 270,000 women producers per year. This new partnership with Investing in Women will help to bring more women into leadership of agriculture in South East Asia. While women make up 50% of the agricultural workforce in South East Asia, they are less likely to be in leadership positions and lack access to training and resources like fertilizer and farm machinery. According to a press release announcing this new partnership, if access for women to key components of the agricultural business were equalized, “farm yields would increase by up to 30 percent—growth which could significantly increase rural incomes and reduce global hunger.”
Root Capital is a pioneer in both gender lens investing and in feminist philanthropy. An editorial published on Philanthropy Women last year, written by Charlotte Wagner of the Wagner Foundation and Catherine Gill, Executive Vice President of Root Capital, articulated key concepts in feminist philanthropy that guide the work.