EBRD: “Women Pay Back Loans Better Than Men,” Data Shows

Women entrepreneurs have demonstrated better loan repayment rates than their male counterparts, according to Francis Malige, Managing Director of the EBRD’s Financial Institutions Business Group. Speaking at the EBRD Women in Business Regional Conference on December 10, Malige challenged traditional risk assessments, stating:

«Women pay back their loans better than men. They are more serious entrepreneurs.»

He noted that this data is driving banks to view lending to women as a commercial opportunity rather than a high-risk endeavor.

Challenging Collateral Requirements

Malige referenced the programme’s initial implementation in Turkey to illustrate the shift in banking practices. He noted that banks originally refused to lend to women who lacked traditional collateral.

To overcome this, the EBRD offered guarantees. «We said, look, we will take a first-loss cover. If the women do not pay back, it is on us,» Malige said.

Following the agreement, banks observed that women outperformed repayment expectations. Malige reported that as the model proved its value, partner banks began requesting larger portfolios with lower risk-sharing, recognizing the «untapped potential» of the market.

Regional Impact and Funding

The focus on female entrepreneurs has yielded significant financial flows in Central Asia and Mongolia. Wendy Teleki, Head of the Women Entrepreneurs Finance Initiative, reported that the partnership with the EBRD has delivered tangible results in the region.

According to Teleki, nearly €315 mln has reached approximately 100,000 women entrepreneurs. She described the figures as «remarkable» and a significant contribution given the current global economic climate.

Remaining Barriers and AI Risks

While the financial data is positive, speakers at the opening plenary, What’s Next: Breaking Barriers to Finance, Power and Participation, noted that structural obstacles remain.

Malige emphasized that finance must be accompanied by support systems. «Being an entrepreneur is a very lonely activity,» he said, citing the need for advisory services and professional networks.

He also warned regarding the integration of technology in lending. While Artificial Intelligence (AI) can widen access, Malige cautioned that it can replicate existing biases if trained on historical data.

«If you feed it data that say 90% of the women need collateral, the system will say, that is a woman, she needs a guarantor,» he said.