On a global level, youth and women face more barriers to access the labor market. This situation becomes even worse when both conditions are met: in Latin America, the proportion of young females who become entrepreneurs due to lack of employment opportunities, is double to that of young males, according to the Iberoamerican Youth Organization (OIJ).
OECD warns that women’s enterprising ventures in the region responds to the excessive amount of time that they devote to household chores and family care, along with a lower educational level and the lack of capital and self-reliance. These obstacles complicate their job search and is one of the factors that determine the youth’s employment insecurity: 60% of working women between 15 and 24 years earn less than the minimum national wage, approximately USD 280 per day on average, according to the Economic Commission for Latin American and the Caribbean.
Because of this, BBVA Microfinance Foundation (BBVAMF) supports youth entrepreneurship which represents around 20% of the 1,2 million female entrepreneurs it serves in Colombia, Peru, Dominican Republic, Chile and Panama.
They are more vulnerable than men: in 2018, 9 out of 10 young women who accessed a loan for the first time with BBVAMF, were socially and economically vulnerable (ie, either their incomes are below the national poverty line, or they are highly probable to fall into poverty), versus almost 80% of young men, according to the Foundation’s Impact Assessment team.
“Entrepreneurship is an antidote against workplace discrimination and other barriers to access formal employment, such as being a young mother”, assures Laura Fernández Lord, head of Women Empowerment for the Foundation. UN Women shares that 59% of the most vulnerable women in Latin America are mothers at 19 years of age. “Running a business becomes one way to achieve a work-life balance and for many of them, the only source of income”, states the Foundation’s empowerment spokesperson.
Aside from facilitating access to microcredits, BBVAMF trains female entrepreneurs how to save so they could provide for contingencies, especially as they thrive in a region which presents the lowest savings rate in the world, according to the Inter-American Development Bank (IADB). World Bank also notes that only 13% of the adult population in the region place their savings in a financial institution, compared to 27% on a global level. This figure lowers to a 10% when we refer to women savers (24% globally) and to 11% in the case of the youth (18% globally). Latin American Development Bank (CAF) also says that savings is one of the most effective tools for financial inclusion and women’s empowerment.