Private Sector Development (PSD)
The PSD team grows revenues for businesses in a defined target market that is women-owned businesses or those whose staff is comprised of at least 30 percent women. The PSD team responds to the current needs of the SME sector through three primary focus areas that include professionalizing management, increasing access to finance, and entrepreneurship development
Many women-owned businesses In Afghanistan suffer from weak financial management and poor financial literacy. This often results in poor investment decisions, inefficiencies in the cost effectiveness of daily operations, and companies taking excessive risks due to lack of planning. A lack of accounting and inventory management systems also results in the inability of businesses to properly price their products and services and makes them less competitive in the market. To address these challenges WIE designed a Finance Corps service for eligible businesses to establish sound financial management practices and put them into practice. The activity assigns accounting interns and qualified professional mentors to a business for six months. During that time, the advisory team helps the beneficiary businesses establish sound record keeping appropriate to the company’s size and needs and learn to use the information appropriately.
Access to Finance and Markets
An important step toward improving access to finance for women-owned businesses and self-employed women is increasing the number of women in mid and senior level positions in banking and microfinance, including commercial lending. The Micro Finance (MFI)Training Program equips women with the technical and managerial skills needed to secure jobs in banking and microfinance by increasing enrollment of women in training programs the MFIs already give to new employees. MFI training is operated under a grant to Afghanistan Microfinance Assoc. (AMA).
The aim of the Access to Finance and market matchmaking roundtable activity is to help women owned or managed businesses learn about different micro and small business loan products and develop relationships with the MFIs that supply them. Simultaneously, the MFIs learn about the SME market and their needs and constraints. The AMA operates this activity on behalf of WIE under a grant.
Women in Commercial Banking is operated under a grant to the Afghanistan Institute of Banking and Finance (AIBF). The purpose of this activity is to increase the number of women in commercial banks first in Kabul and then the other four regions of WIE operations. There is a target of 150 beneficiaries over a six month period after which they will be placed in commercial banks for a three-month internship.
Access to Markets
Trade fairs and exhibitions are good opportunities to assist Afghan women to increase their participation in the private sector and formal economy. Trade fairs serve as an effective platform for WIE client businesses to get training and exposure on finding more customers, suppliers, contractors, and to improve businesses' understanding of customers and competitors. Trade fairs also have potential for generating more sales and contracts, which is directly linked to WIE's broader objectives of increasing access to markets for women’s businesses. WIE stages regional Forward Together: Women in Business trade fair over the course of the year in Afghanistan’s major urban centers, which then culminates in a large national trade event in Kabul.
Product Development and Packaging
A major obstacle to improving access to local markets and export performance is the lack of know-how among businesses and service providers in developing appropriate products. WIE established a product development service to develop the capacity of local and national MBA graduates, consultants, and service providers to assist women’s businesses in product quality development, quality improvement, packaging, and regulatory compliance. Currently in its pilot phase, the activity is initially focusing on food processors, namely those who are in the saffron producing business.
Support to Entrepreneurs: Business Incubation Centers
Encouraging entrepreneurship and start-up businesses is an important means of delivering on the three core goals of private sector development: generating jobs and wealth, boosting productivity, and creating market competition, and bringing innovative products and services to the market. Given the potential contributions of SMEs to the Afghan economy, support to entrepreneurs is a key component of WIE’s Private Sector Development strategy. WIE supports two Kabul-based business incubators Startup Valley and Founder Institute (FI), both implemented through grants
Through the MBA Corps activity, WIE demonstrates the value of professionally trained managers to small business owners, some of whom cling to traditional family run business practices and are reluctant to bring in professionals perceived to be ‘outsiders.’ Mentoring is an important aspect of this activity; it helps the business owner understand how to incorporate innovative ideas into his or her business as well as helping the recent MBA graduate learn how to be more effective in his or her new role.
One of the issues identified as a barrier to growth for micro, small, and medium enterprises (MSMEs) is the lack of professional management skills and expertise that are required for a business to grow beyond a certain stage. Without these skills, the business often stops growing and may even fail. Intended to address the need to professionalize management, the Entrepreneurship Toolkit (the toolkit) is designed to support the growth of private businesses. The toolkit serves as a reference so that the WIE beneficiary businesses can utilize the information as needed in the course of expanding their businesses.