Every day, across six campuses in Uganda, close to 4,300 children attend schools that only exist because one woman refused to take no for an answer. Barbara Ofwono, Founder and Chief Executive Officer of Victorious Education Services, overcame repeated setbacks and bank rejections before she finally secured credit to grow her schooling empire.

Ofwono trained to be a secondary school teacher at a time when few took a woman at the front of the classroom seriously. When she finally invested her savings in her first school, the returns were taken by the others who ran it, and her stake was never given back.

Starting over, Ofwono applied for a loan with a prominent bank. She was denied. In true Ofwono style, she used the rejection to learn exactly what banks wanted to see and set about meeting each and every condition – including expectations that reflected the additional scrutiny often placed on women entrepreneurs, such as ensuring there were men on her board - until she successfully secured credit elsewhere. “The bank that rejected me now cries for me,” said Ofwono, adding, with an arched and neatly plucked brow: “I’m not with them, because they are slow.”

“The bank that rejected me now cries for me"

- Barbara Ofwono

While digital payments and mobile money solutions have expanded in Uganda, access to credit often still depends on collateral, such as property, land or savings. But when collateral becomes the main test of creditworthiness, it can exclude viable women-led businesses with strong cash flows, customers and growth potential, but limited formal assets.

Alternatives such as cash-flow-based lending, transaction data and digital business records can help financial institutions assess risk differently. For women-owned enterprises like Ofwono’s, this can create a more accurate basis for lending, rooted in business performance rather than collateral alone.

One size does not fit all

Even with proven business acumen and skills, many women like Ofwono fail to meet the prerequisites to access financial services and productive credit, such as loans that could help develop and grow their businesses. This is not necessarily a failing on their part. It reflects a financial system in which the policies, rules and incentives that shape banking and digital financial services often do not account for women entrepreneurs’ realities.

Uganda’s women's financial inclusion challenge, as in many other contexts, is not simply the absence of reform or investment interest per se. Uganda has made real regulatory progress: a National Payment Systems Act, a national inclusion strategy with explicit gender targets and data-protection law. However, alignment across the full system remains incomplete. Conduct rules, regulatory standards that enforce behavioral standards for financial service providers (FSPs) in their interaction with consumers, how they conduct their business and behave in the marketplace, are higher for licensed payment providers than for microfinance lenders or savings groups.

And while gender-disaggregated data exists through a public data platform, it is not yet comprehensive across providers, including banks and credit unions, or consistently formatted in ways that can help determine creditworthiness.

Collectively, these challenges dampen the investment case for capital to flow to business models that deepen financial inclusion for women like Ofwono and drive their economic empowerment. It’s a loss not only to the women-led businesses involved, but to economic growth more broadly.

Experts from UN Capital Development Fund met and interviewed Ofwono in the context of their work on women’s digital financial inclusion in Uganda where the organization works with policymakers, regulators and market actors to understand how financial systems can better serve women's economic empowerment and entrepreneurship.

Policy rooted in women entrepreneur’s realities

That work is informed by a seven-year programme dedicated to advancing women’s digital financial inclusion in Africa, supported through the G7 Partnership for Women’s Digital Financial Inclusion in Africa, under the leadership of the French G7 presidency. Ofwono's experience reflects the kind of barrier this work is intended to address: not only access to digital tools, but the policy and market conditions that determine whether those tools translate into fair access to credit.

Through its Policy Accelerator, UNCDF supports partner countries to examine where financial-sector rules, data systems and market incentives may unintentionally exclude women. This can include looking at how gender-disaggregated data is collected and used, whether providers can assess creditworthiness beyond collateral, and how policies can support responsible digital and cash-flow-based lending.

The aim is not to replace financial institutions’ need to manage risk. It is to help create an environment where risk can be assessed more accurately, so viable women-led businesses are not excluded simply because they do not fit the traditional borrower profile.

Globally, women continue to face barriers to accessing and using financial services. Even though 77% of women globally now have a financial account compared with 81% of men, only about half of economies have legal frameworks that support women’s equal access to credit, leaving many women at risk of being left behind. Particularly MSME ecosystems that are critical to jobs, livelihoods, and economic growth. Digital tools can help — a mobile wallet, an online payment platform, a digital loan — but technology alone is not enough. Gender norms still shape who has access to credit, who influences the decisions that drive access, who owns the phone, and what information is available so a woman entrepreneur can prove her business is sound.

While the Uganda regulatory environment provides a relatively strong foundation for financial inclusion, UNCDF team’s investigations found that access alone is not enough. Policy needs to also enable meaningful protections and productive opportunities. In other words, good policy is rooted in the lived realities of the end users – and that includes women entrepreneurs.

In Ofwono’s case, access to finance did not hinge on one breakthrough, but on a long process of aligning her business to fit what the system recognized, even when those expectations are rarely designed with women in mind.

Today Ofwono continues to innovate and grow her business. Her schools moved to online learning during COVID so that children would not fall behind, and she now collects fees through a digital platform, ‘School Pay’. Such investments have not been cheap — the online platform alone has carried loans running into the billions of Ugandan shillings, and she is still repaying them.

“It is very, very costly,” Ofwono admits. Nonetheless, it’s a cost she is happy to carry, not only because of what it buys, but for what it can offer the next generation of young Ugandans.

“A school is real estate plus education,” she said. “When children are young, they need you. You have to give them your values.”