Chapter 5 presented and analysed data which addressed the research objectives. Exploratory factor analysis carried out in the previous chapter, revealed the lending criteria used by banks or financiers to finance women-owned SMESs in Gweru, Zimbabwe. This chapter discusses the findings according to the study objectives and literature reviewed.
6.1.2 Objective 1: To Determine the Lending Criteria Used by Banks to Process Loan Applications by SMESs in Zimbabwe.
The results of this study tally up with previous research findings by some scholars highlighted in the literature review chapter of this study (Pekmezovic and Walker, 2016; Bimha et al., 2018;
Shukla and Chauhan, 2018). Additionally, the results concurred with those of other scholars who also tested the hypotheses in other studies (Kraemer-Eis et al., 2017; Kljucnikov, Belás, Kozubíková, and Paseková, 2016). The results of this study, presented in Chapter 5, revealed the presence of stringent bank credit application requirements and constricted controls on women- owned SMESs. The study suggested sub-constructs, namely, partnerships and guarantees, financial history, business planning, experience and specialisation. These sub-constructs are discussed individually, in this section, taking note of the variable created to represent each of the four.
6.2.3 Partnerships and guarantees
One of the four sub-constructs presented and analysed in Chapter 5 was partnerships and guarantees. This sub-construct had a reliable measure of the intendent latent variable representing partnerships and guarantees (Cronbach’s Alpha=0.823). The latent factor composed of having a male partner in the business, having a male owner, having a guarantee from a spouse and having title deeds as loan security had a reliable measure. These results of the study concur with the reviewed literature which indicated that women-owned SMESs rely heavily on males, which affects their access to financial resources (LeVine, 2018; Corkery, Taylor and Hayden, 2018).
Similarly, findings of this study revealed that partnerships and guaranteed are critical in order for female-owned SMESs to improve and access loans from banks. In this light one is inclined to conclude that there is a bias in loan application and the success of a venture that is determined by the gender of the type of partnership of a business.
6.2.4 Financial history
The study revealed that items of financial history or background are vital factors of the lending criteria as indicated by the high percentages of respondents who agreed or strongly agreed. This sub-construct had a reliable measure of the intendent latent variable representing financial history (Cronbach’s Alpha=0.794). These results also agree with Credo (2016), who alluded that financial history is part of the procedures and standards established by a bank and utilised by its workers to and regulate the application processes for a financial advance by a client. In the same vein, the data analysis in this study showed that having a good repayment record on previous loans increases the likelihood of accessing a loan, regardless of the applicant being female. This result means, therefore, that, banks/financiers regard clients with a good repayment record on previous loans as an indicator towards less financially risk behaviour.
The findings on the other two factors, i.e. Expectations and Specialization as well as Business Planning, were excluded from further analyses as the Cronbach Alphas are too low and reliability is not confirmed.
6.1.3 Objective 2: To Investigate whether the Bank SMES Lending Criteria are Biased against Women-Owned SMESs in Gweru, Zimbabwe
Objective two of this study was to investigate whether the Bank SMES lending criteria is biased against women-owned SMESs in Gweru, Zimbabwe. The findings of this research concur with the literature which suggests the existence of discriminatory tendencies against women-owned SMESs in favor of other socio-economic groups. The theoretical framework in Chapter 3, together with reviewed literature (Bruton, Khavul, Siegel and Wright, 2015; Ary, Jacobs, Irvine and Walker, 2018), are also in agreement with the findings in Chapter 5, which revealed that the Bank SMES lending criteria are biased against women-owned SMESs in Gweru, Zimbabwe.
The feminist theories discussed in the theoretical framework showed that there exists preferential treatment of men against women due to underlying stereotypical tendencies in society. Apart from the finding that partnerships guaranteed by and with men increases the likelihood of access to loans, the findings of this study show that the content of the business idea is more important. Bank lending criteria are biased in that, according to the findings of this study, female entrepreneurs can access bank loans if they have a male guarantee. This factor negatively influences the accessibility of loans for women based on their gender.
6.1.4 Objective 3: To Evaluate the Extent to Which the Bank SMES Lending Criteria affect the Growth and Sustainability of Women-Owned SMESs in Gweru, Zimbabwe
This section discusses the construct of the growth and sustainability of women-owned SMESs in Gweru, Zimbabwe and the related sub-constructs of the lending criteria. The growth rate of the business since receiving funding was measured by the growth in the number of employees, increase in sales, increase in profits, physical size of business premises, diversification, market share, and number of females on management. For those women-owned SMESs which received funding, their highest growth indicator was in the increase in sales of 90.8 percent.
Furthermore, this increase shows that the stereotypes that women are unable to increase their businesses are baseless. Therefore, discriminating against women in bank loan accessibility threatens the sustainability of their businesses rather than their natural abilities. In this light, the socialist feminist theory that advocates for equal opportunities for both women and men is rightly placed, as women can improve their businesses given the opportunities.
The assertion by Wellalage and Locke (2017) that due to discriminatory tendencies women- owned enterprises lag behind those owned by the youth and men, can be validated by the findings in this study. The findings established by the study show that with improved and equitable access to loans, women-owned enterprises increase in sustainability and growth. The findings o showed that when banks afford women loans, they plough back the money into the business resulting in growth in sales, increase in number of employees and in profits. These factors show that women and men are both able to contribute to the economy provided they are afforded equal opportunities.
Both the liberal and socialist feminist advance the fact that if women are allowed access and similar opportunities with men, they will be able to improve their circumstances (McElroy, 2002). They also posit that both genders have similar competencies, but preferential treatment diminishes the efforts of one of the genders (Greenway, 2000). The finding that women entrepreneurs in Gweru who had access to loans were able to grow their businesses and improve their market share, is a testimony to the equality that exists between men and women. In this instance, preferential treatment of men over women is thus baseless and limits the contribution that women can make to society.
6.1.5 Objective 4: To Highlight the Level of Alignment of the Bank SMES Lending Criteria to the Government Policy of Empowerment of Women-Owned SMESs in Gweru,
Zimbabwe
The findings for Objective four were mainly from the qualitative data collected from the Bank SMES Loan Managers and SMES finance experts in Gweru. The study established that there were appropriate policies in Zimbabwe; however, there were several variables that hindered an effective implementation of these policies. For instance, the findings revealed that most local entrepreneurs were attracted into the business by the unregulated interest and discounts rates. This situation resulted in an influx of small businesses in Gweru.
Another highlighted variable is the decline in the national economy in Zimbabwe where the business industry has been perceived as a lucrative business opportunity to curb the high rates of unemployment and poverty. In the process, more and more women-owned SMESs continue to suffer gender related issues in their bid to secure funding for their businesses. These study findings concurred with the results from past research projects by other scholars, listed in the literature review chapters, who highlighted that women SMES owners continue to find it difficult to acquire business funding for the ventures (Xie,2016; Cohan, 2017; Lee and Brown, 2016; Zhu, Xie, Wang and Yan, 2017).