‘Land loans’ offer Tanzanian women entrepreneurs a chance to develop

DAR ES SALAAM, January 18 (Reuters) – Mshindi Mayenga, a hairdresser in the Tanzanian capital, had the idea of ​​expanding her business. She wanted to transform her small living room from a dilapidated rented room into a larger “main street” business, but every time she applied for a bank loan her request was turned down.

She did not own her house or land, and had no assets that could serve as collateral for the loan.

“I was asked to present valuable assets to support my candidacy but I did not have any,” she said.

After a long struggle, the 31-year-old entrepreneur from a bustling Dar es Salaam suburb was able to secure land on loan, which helped her access the finance she needed.

Mayenga is one of thousands of low-income women entrepreneurs in Tanzania who have acquired land registered as a loan, which they can use as collateral to seek finance to expand their businesses.

As part of its broader policy of empowering women, the Tanzania Women’s Bank (TWB) has started lending registered plots of land to women entrepreneurs to lift them out of poverty.

“I am very happy to buy land through this deal, my loan was approved within days,” Mayenga told the Thomson Reuters Foundation.

“I have already started building my house in Kigamboni, where my new land is located, and I hope to use my land title to borrow 10 million Tanzanian shillings ($ 5,000) to expand my businesses.

Despite bearing the burden of family responsibilities and making up half of the agricultural workforce, Tanzanian women face discrimination in property rights, activists said.

Although Tanzanian law grants women the same rights as men to access, own and control land, and allows them to participate in decision-making on land matters, only 20 percent of women own land in their own right. own name, according to USAID.


Women’s land rights are set out in the Land Law and the Village Land Law of 1999, which state: as a human right.

But Tanzania’s customary norms make it difficult for women to own full land. Instead, many access it through their spouse or male relatives, which means they often end up losing it if the men die.

Laws are poorly enforced, denying many women their land rights, activists say. A ripple effect of this is that women have problems accessing credit to enable them to develop small businesses.

Women’s businesses tend to be smaller, have fewer employees, and lower growth prospects than those owned by men.

TWB, together with Ardhi Plan – a real estate company – hopes to improve the prospects of women entrepreneurs by lending land at low cost.

“We realized that most women don’t get bank loans because they don’t have real estate assets as collateral,” Margaret Chacha, managing director of TWB, told the Thomson Reuters Foundation.

Since the project began a year ago, more than a thousand women entrepreneurs in Dar es Salaam have obtained land loans, the bank said.

“We urge women entrepreneurs to take this opportunity to acquire the plots and get their title deeds which they can use to obtain capital loans,” said Chacha.

Borrowers are required to deposit at least 30 percent of the value of the plot and pay the rest in installments until they have repaid the loan and own the land.

Activists hailed the initiative as a model for empowering women entrepreneurs, not only in Tanzania but across East Africa.

In Uganda, a similar project was started by the Development Finance Company of Uganda in 2007 to help women obtain loans to purchase property to use as collateral.

“I think this is a positive step as land is an asset that is valued every day,” said Jane Magigita, executive director of Equality for Growth, an NGO that supports women in the sector. informal.

Land registration is a cumbersome process in Tanzania, riddled with corruption and mismanagement, which is why most people do not have formal rights to their land, according to Transparency International’s 2013 Global Corruption Barometer. .

In Dar es Salaam, nearly 70 percent of the city’s 5 million people live in informal settlements.

But Marina Agostino, who bought 600 square meters of land under the new program, said she found it easy to access the land through the TWB.

“It is difficult to get land through official government channels due to bureaucracy and corruption,” Agostino said.

“I haven’t started construction yet but I plan to build a modest house to rent out in order to earn more income to invest in my catering business. (Edited by Ros Russell; please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, which covers humanitarian news, women’s rights, trafficking, corruption and climate change. Visit news.trust.org)

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