Investigating impediments towards access to financial services by women entrepreneurs: A Case of Arumeru District

Lack of finance has been mentioned as a major reason which tends to paralyse women MSE’s in Tanzania and in Arumeru district in particular. In investigating this situation, a field research was conducted in Arumeru District between January and July 2012, with the aim of identifying microfinance institutions operating in the district and investigating the main challenges facing women (micro and small entrepreneurs) in accessing financial services. A sample of 150 respondents was selected, whereby 100 women entrepreneurs were involved in an interview and focus group discussion and while another sample of 50 respondents drawn from different stakeholders was included in focus group discussions and other research methods utilized in the study. From the research it was discovered that women face a lot of challenges including discrimination by the institutions, small loan sizes, strict unfavourable conditions, lack of collateral and property rights, high interest rates, lack of financial confidence and presence of cultural norms which stereotype against women in accessing and controlling any financial means. It is from these challenges that the study recommends to the financial institution to redesign their products to suit their clients’ needs and the government to re-evaluate the interest rate charged by the financial institution to be fair according to the level of the enterprise the client owns. Key words: entrepreneurship, financial services, gender, women