CHAPTER 6: PRESENTATION OF FINDINGS
6.1.5 The Nature and Diversification of Participants’ Businesses
148 According to Margaret:
What I learnt was that because I borrowed money from Inhlanyelo Fund you have to try by all means to pay back the loan. Because if you don’t pay back the loan, other members of the community would be unable to borrow money from the fund because of you. I felt as if it was not right and it shouldn’t be me who causes other members of the community not to be able to benefit from the fund when these people could do with the fund’s assistance (Primary Data, 2020).
As previously stated, the peer pressure method appeals to women in terms of collectiveness and humanness, in that they see it as doing others a favour by paying off their loan so that it does not discourage others from borrowing. They do not realize, however, that it is a strategy of the financial institution to ensure that it does not lose any money in the business.
According to research, women who receive loans from microfinance institutions typically use them to solve other problems, particularly to meet the needs of their households (ILO,2007;
Banerjee et al., 2017). This is entirely due to their poverty and inability to provide basic necessities such as food, shelter, and clothing for themselves and their families. As a result, Inhlanyelo Funds are frequently used to meet these needs.
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would prefer not to change their businesses. Altay (2007) notes that microfinance allows poor people to protect, diversify, and increase their sources of income which is the essential path out of poverty and hunger. The findings reveal that the majority of participants switched from one business to another due to the original business' poor performance. As a result,
participants often had more than just one business. A few participants indicated that they would sometimes borrow for one business and then use the loan to start or expand another existing business.
When Sonto was asked if she would borrow from the fund again, she responded:
I would go there running. For starters, the Inhlanyelo fund has low interest rates. An individual can tell that the fund's purpose is to help small businesses, particularly women's businesses, grow (Primary Data, 2020).
Because the amount payable by the Inhlanyelo fund was insufficient, Alice was unable to diversify into a more profitable business. Alice split her loan for the poultry farm, with her vegetable farming business. As a result, she continued to run her vegetable and chicken farm.
Ngabisa stated:
I borrowed money from the fund in order to meet my clients' demands by purchasing a large amount of stock, which I was unable to do on my own or with the income I was generating prior to requesting assistance from the Inhlanyelo (Primary Data, 2020).
In this case, we can see how the fund affects the nature of the business in the sense that a beneficiary cannot always start a new business. Instead, the loan may only support existing businesses.
Merriam was a seamstress who expanded her business to include ready-made clothing that she bought from South Africa and sold, and she wanted to diversify into chicken broilers. She stated:
If I were breeding indigenous chickens or rearing cattle, I would make more money.
As a result, it is necessary to have a variety of businesses rather than relying solely on one (Primary Data, 2020).
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Nonhlanhla responded by saying she would put the money into the same business because it made a lot of money and she could not afford to do anything else to improve her life because she was a single parent. This implies that she did not want to add additional burdens because she already had too many responsibilities with the children and the business. In a similar sentiment, Ahl (2006) indicates that women’s domestic responsibilities and child care have an impact on business endeavours and have a negative outcome. However, women are normally expected to do all household chores and childcare responsibility as per the
patriarchal expectation despite the fact that women are now also engaged in business ventures (Roomi & Parrott, 2008).
6.1.5.1 Impact of Inhlanyelo Fund on Women’s Choice of Business
This section shows how women’s experiences in participating in the Inhlanyelo Fund determine the kind of business they can do or diversify into. The fund does not permit beneficiaries to change the nature of business they initially ventured into. A few participants found the fund had an impact on their choice of business because the fund only financed the business for which the money is applied for. According to Alice:
Inhlanyelo Fund doesn’t allow us beneficiaries to change businesses because at the beginning when we were borrowing money from the fund I stated that I was requesting the loan for brooding chickens and farming. I did try to change and said that I wanted to buy and sell school uniform especially jerseys but their response was negative because they didn’t trust that their loan was going to be paid back as there was a possibility that no one would buy the jerseys or that it might take a long time to sell the jerseys as I was only about to penetrate that market. Or that there was a possibility that I would buy poor quality jerseys which would also result in not being able to sell the jerseys (Primary Data, 2020).
This was limiting in a number of ways, as it did not afford the beneficiary the opportunity to explore other fertile business ideas that could yield more income. There was little or no pportunity to expand, diversify, pivot or respond to markets shifts. Some of the beneficiaries that diversified did so without the fund’s knowledge. However, the fund finances one
business at a time until you repay the current loan in full. The fund continues to support businesses that have a high risk of natural disasters.
Thoko said:
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I am also practicing farming as a business but there are advantages and disadvantages.
It’s a win or lose situation especially if with maize. Drought is a major factor that hinders this type of business (Primary Data, 2020).
Because of the insecurities in farming, Thoko decided to invest in buying clothes from South Africa to resell in her community. This business too, however, was affected by the current lockdown regulations due to the COVID-19 pandemic.
Similarly, Zandie said:
I would borrow money from the fund again because I have a passion for farming but I would also like to add another business which is breeding domestic animals. I would borrow the money to diversify my business to breeding animals (Primary Data, 2020).
For some of the participants, the training session offered by the Inhlanyelo Fund affected their choices in terms of the kind of business they ventured into in the future. For Ngabisa, the training organized by the Inhlanyelo Fund persuaded her not to engage in a certain business and also helped her see possibilities in some other kinds of business. We see how the credit provider affects women’s experiences in terms of the nature of business they engage in, as well as the choices available to them, especially with regard to the amount of money
available to venture into specific kinds of businesses to better empower their lives.
Women tend to start smaller businesses than men, and businesses are mostly informal which could be because women have fewer resources, and their main interest in being self-
employed is to escape poverty rather than being driven to be an entrepreneur. The ILO (2017) reports that women become self-employed due to their situation and the need for income rather than from being business oriented.
6.2 Learning Experiences of Women Beneficiaries of The Inhlanyelo Fund