Women make up the majority of the Brazilian population and head 50.9% of households in Brazil. However, they still have a lower average income than men. This demographic group was the most affected by job closures during the Covid-19 pandemic, leading many of these women to turn to entrepreneurship.
According to Sebrae (a Brazilian autonomous institution that fosters the development of micro and small enterprises), although Brazil has the seventh-highest proportion of female entrepreneurs, the conversion of these women into business owners is 40% lower compared to men, which indicates a higher dropout rate among women.
“Women entrepreneurs also take fewer loans from banks, with a lower average credit amount, and they pay a higher average interest rate, despite having a 12% lower default rate than the male population,” says Mayara Estima Natorf, Corporate Reputation Analyst at Sicredi.
In light of these circumstances, Sicredi sought to develop “Elas Cooperam” (in English, “They Cooperate”), a value proposition with solutions that encompass financial products and educational tools to help women entrepreneurs throughout Brazil to prosper in their businesses.
How the “Elas Cooperam” Project Works
One of Sicredi’s first steps was to look inward, specifically at its credit portfolio. The cooperative realized that only 20% of the portfolio was dedicated to women, even though businesses led by them experienced a 42% higher growth than those led by men after credit approval.
“We assessed that, among our 106 cooperatives, 46 have the Women’s Committee, and of these, 34 have microcredit as a credit line with attractive rates — both premises for our project. It’s worth noting that we also assessed the market and noticed that other financial institutions do not discuss discounts or benefits in interest rates or maturity,” explains Ruan Osorio Schmidt, Quality Engineer at Sicredi.
After studying and comparing credit lines, Sicredi chose to offer the Microcredit line with a 36-month term without grace period, and also developed PRONAMPE, the National Program to Support Microenterprises and Small Businesses.
In summary, the scope of “Elas Cooperam” includes:
- Communication and marketing book outlining the project strategy
- Pricing and fee suggestions for pilot cooperatives
- Communication and marketing costs
- Development of an operational and business guidance kit tailored to this audience
This scope will be suggested to Sicredi’s central cooperatives, which will be able to replicate it to other cooperatives in the system. “Following our governance where nothing is top-down, we will present our suggested strategy and guidance to the five central offices to initiate the pilot program,” explains Mayara.
Support Beyond Credit
The main product of the “Elas Cooperam” project is indeed credit, as explained by Ruan Osorio Schmidt: “We recommend two products that we have studied, with pricing suggestions and attractive rates, always in line with the needs of the associate and the region where the cooperative operates”.
However, Sicredi offers more than that. The cooperative also supports these women through financial education programs and partnerships with educational institutions. “And we will bring the project’s advantages to our business and to the communities where the five cooperatives we elected as pilots are located,” Schmidt adds.
The project is also directly aligned with the United Nations’ Sustainable Development Goals (SDGs), as it contributes to the objectives of inclusion and economic empowerment of women. One of the indicators observed by Sicredi, for example, is SDG 5 (Gender Equality), in which item 5.5 states:
To ensure full and effective participation of women and equal opportunities for leadership at all levels of decision-making in political, economic, and public life.
