Inclusive Finance for Growth of Women and Youth MSMEs
About the Program
The Inclusive Finance for the Growth programme is designed to address the financial and capacity barriers that limit the growth of women and youth-led enterprises in Tanzania. By offering tailored financial solutions and enterprise development, alongside evidence-based policy engagement, the program is expected to enhance access to affordable financial services. Key initiatives include an MSME Impact Grant Fund, Venture Capital and Private Equity support, and Technical Assistance for financial service providers. With a focus on fostering innovation and building robust financial infrastructure, the program seeks to promote inclusive and sustainable economic growth, particularly within green and circular economies.
Program Interventions
Impact Grants Fund
Access to capital can make or break a small business, but for many women and youth in Tanzania, financing remains out of reach. This intervention aims to close this gap by providing catalytic grants to help promising enterprises invest in growth, formalize, and tap into new markets. Focused on high-impact sectors like green energy, waste management, and digital trade, the fund is expected to empower MSMEs to create jobs, increase incomes, and drive inclusive economic transformation across Tanzania.
Impact Grant Fund
Impact Grants Fund focuses on supporting women and youth-led MSMEs with capital and operating grants to help them start, grow, or formalize their businesses. It focuses on businesses with high potential for social and environmental impact, especially in green and digital sectors.
Whose lives are we trying to improve?
The intervention aims to improve the lives of women of all ages and youth between 18 and 35 who operate micro, small, and medium-sized enterprises (MSMEs) across Tanzania. These enterprises may be at the start-up stage or in early growth, with significant potential for expansion, especially those contributing to the green, circular, and digital economy.
What challenges are they currently facing?
The targeted beneficiaries have limited access to start-up or expansion capital, mainly because mainstream financial services often impose strict eligibility requirements, such as demanding tangible collateral and charging high interest rates. Limited access to capital leads to insufficient access to the necessary business tools, human resources, productive equipment, and market opportunities essential for efficient operations and growth.
What Market System Change must take place to resolve the challenge?
A fundamental shift is necessary in how the market addresses financing for women- and youth-led MSMEs. The system must incorporate blended finance tools and grants to mitigate risk barriers, encouraging formalization, innovation, and growth. Additionally, systems should identify and provide high-potential MSMEs with blended finance, capacity-building, and market access.
How will FSDT intervene?
FSDT will establish an Impact Grant Fund that offers both Capital and Operating Grants to women and youth MSMEs. Capital Grants will help enterprises invest in startup infrastructure, equipment, and formalization processes. Meanwhile, Operating Grants will aim to improve working capital to support business growth and operations. Grant amounts will range from TZS 1 million to TZS 50 million, depending on enterprise size and the expected impact of the investment.
Eligible enterprises are those that have employed or been led by at least 50% women and youth and possess a strong business plan or investment case approved by the investment committee. FSDT will enforce a co-investment requirement of at least 20% and provide light technical assistance to promote sustainability. Selected grantees will also be linked with financial service providers for additional credit and equity opportunities where applicable.
What are we hoping to achieve through this intervention?
This intervention aims to expand access to catalytic finance for women and youth-led MSMEs. It also expects the grant fund to accelerate the growth of businesses in high-impact sectors like renewable energy, waste management, and digital commerce. This will boost productivity and formalize previously informal businesses, while building a pipeline of enterprises ready for further investment from financial service providers and venture capital funds. Ultimately, this will promote greater financial inclusion and socio-economic empowerment.
What lasting impact do we intend to achieve?
The Impact Grant Fund aims to build long-term financial resilience among women and youth entrepreneurs. It will support job creation, increase household income, and promote economic diversification in underserved regions.
INTERVENTION PERIOD
2024 - 2027
FUNDED BY
Technical Assistance and Advisory Services
This intervention aims to equip financial service providers with tools, insights, and capabilities to design inclusive, gender-responsive products. By supporting institutions to better understand and serve underserved markets, this initiative is expected to expand access to meaningful financial servicesstrengthening the resilience of women and youth-led businesses across Tanzania.
Technical Assistance and Advisory Services
Whose lives are we trying to improve?
This intervention is designed to indirectly improve the lives of women and youth between the ages of 18 and 35 who are entrepreneurs or business owners across Tanzania. The intervention focuses on strengthening the capacity of Financial Service Providers (FSPs) to develop and deliver inclusive, affordable, and relevant financial solutions. By building institutional capacity within the financial sector, women and youth stand to benefit from enhanced access to financial products and services that better meet their unique needs and circumstances.
What challenges are they currently facing?
Women and youth MSMEs face systemic exclusion from financial markets due to the limited capability of financial institutions to serve these segments effectively. FSPs often lack the tools, systems, and market insights required to design inclusive financial products. There is minimal use of disaggregated data in product design, limited staff expertise in serving these target groups, and weak institutional readiness to support underserved clients. These barriers lead to the continued provision of generic, inappropriate financial services that fail to reach or serve women and youth effectively.
What Market System Change must take place to resolve the challenge?
To overcome these barriers, a shift is needed within financial service providers towards inclusive product development and gender-responsive service delivery. The financial system must integrate institutional incentives that promote inclusive finance, while also building sustainable internal capacities to generate and apply market insights. The widespread adoption of practices such as gender-disaggregated data collection, user-centric product design, and human-centered delivery channels must become standard across the sector.
How will FSDT intervene?
What are we hoping to achieve through this intervention?
This intervention seeks to expand the number and quality of financial products and services available to underserved markets, particularly women and youth. FSPs will be equipped with the knowledge and resources needed to develop products and services that are relevant, accessible, and sustainable. The program aims to increase the volume and uptake of inclusive financial services, promote innovation in product design, and strengthen partnerships across the financial ecosystem to reach underserved communities.
What lasting impact do we intend to achieve?
The intervention is expected to leave behind a stronger, more responsive financial sector with embedded practices for serving women and youth. Participating institutions will be better equipped to offer inclusive financial products beyond the life of the project, using the systems and capabilities developed through technical assistance. Over time, this will contribute to reduced exclusion, increased access to finance, and greater resilience among Tanzania’s most economically vulnerable entrepreneurs.
INTERVENTION PERIOD
2024 - 2027
FUNDED BY
Venture Capital Fund
This intervention aims to unlock equity finance for high-potential MSMEs in sectors like agribusiness, green innovation, and digital services. By establishing a national fund in partnership with key public and private actors, this initiative is expected to fuel business expansion, attract private investment, and strengthen Tanzania’s inclusive investment ecosystem.
Venture Capital Fund
The Venture Capital Fund is an equity financing initiative under the Inclusive Finance for Growth of Women and Youth MSMEs program, designed to support start-ups and growth-stage MSMEs with high potential. Managed in partnership with CMSA and the Ministry of Finance, the fund will provide equity investments ranging from EUR 50,000 to 250,000 to help businesses scale, innovate, and create jobs.
Whose lives are we trying to improve?
This intervention aims to enhance the lives of women and youth entrepreneurs running start-up and growth-phase micro, small, and medium-sized enterprises (MSMEs) across Tanzania. These entrepreneurs often lead businesses in sectors like agribusiness, technology, green innovation, and digital services but face challenges in accessing long-term, growth-focused funding. By enabling access to equity finance, the intervention will open new pathways for business expansion and financial sector innovation.
What challenges are they currently facing?
Women- and youth-led MSMEs face significant barriers in securing equity investments, mainly due to the limited availability of risk capital, low investor interest driven by perceptions of high risk and low returns, a weak enabling environment, and a lack of equity instruments designed for early-stage and growth-focused enterprises. Furthermore, many of these businesses find it difficult to attract investors because they are not investor-ready.
What Market System Change must take place to resolve the challenge?
There is a need to develop and strengthen a functional, inclusive, and equitable investment ecosystem. This involves establishing a national venture capital fund that provides both equity and debt instruments to MSMEs, supported by a comprehensive legal and regulatory framework that facilitates the efficient operations of venture capital and private equity funds. It also includes creating credible investment vehicles and building investor confidence in women- and youth-led enterprises. Furthermore, the venture capital market must incorporate and offer technical assistance to ensure that early-stage businesses are prepared to access additional financing after exits.
How will FSDT intervene?
FSDT will collaborate with the Capital Markets and Securities Authority (CMSA) and the Ministry of Finance to establish a National Venture Capital Fund and hire an experienced fund manager to operate it. The Fund will be financed through government and development partner resources, as well as other local and international investors. FSDT will finance the technical design of the Fund, oversee its registration, recruit, and pay the Fund Manager, and facilitate stakeholder engagement and fundraising.
What are we hoping to achieve through this intervention?
The intervention aims to increase access to equity capital for high-potential, women and youth-led MSMEs and to expand the number of enterprises capable of attracting private sector investment. It will enable business growth and innovation in key sectors, enhance the capacity of enterprises to create jobs and wealth, and position Tanzania as a viable destination for inclusive venture capital investment.
What lasting impact do we intend to achieve?
The Venture Capital and Private Equity Fund aims to build long-term financial resilience among women and youth entrepreneurs. It will support job creation, increase household income, and promote economic diversification in underserved regions.
INTERVENTION PERIOD
2024 - 2027
FUNDED BY
Policy Reforms
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Policy Reforms
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Whose lives are we trying to improve?
What challenges are they currently facing?
What Market System Change must take place to resolve the challenge?
How will FSDT intervene?
What are we hoping to achieve through this intervention?
What lasting impact do we intend to achieve?
INTERVENTION PERIOD
2024 - 2027
FUNDED BY
Financial Systems and Data Management
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Financial Systems and Data Management
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Whose lives are we trying to improve?
What challenges are they currently facing?
What Market System Change must take place to resolve the challenge?
How will FSDT intervene?
What are we hoping to achieve through this intervention?
What lasting impact do we intend to achieve?
INTERVENTION PERIOD
2024 - 2027
FUNDED BY
Enterprise Development
Enterprise Development aims to strengthen women and youth-led MSMEs in Tanzania by addressing key gaps in business skills, digital literacy, and access to finance and support services. In partnership with local Business Development Service (BDS) providers, incubators, and accelerators, this intervention is expected to helps these businesses improve their performance, formalize operations, and become investment-ready. Running from 2024 to 2027, the intervention seeks to build a more inclusive, innovative, and resilient entrepreneurial ecosystem across the country.
Enterprise Development
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Whose lives are we trying to improve?
This intervention supports women and youth across Tanzania who own or manage MSMEs facing challenges in acquiring business skills, networks, and support systems needed for growth. Many run informal businesses with low productivity and limited access to finance and markets.
What challenges are they currently facing?
Women and youth entrepreneurs often lack financial literacy, digital skills, and an understanding of compliance, which leads to poor record-keeping, inefficient operations, and limited access to technology, all of which hinder growth and competitiveness. They lack access to business services, mentorship, and tools for formalizing and expanding their businesses. Usually not investment-ready, which makes them struggle to attract funding.
What Market System Change must take place to resolve the challenge?
Tanzania’s entrepreneurial ecosystem needs to continue being strengthened and expanded to provide comprehensive, inclusive, and context-specific support to MSMEs. This includes building networks of incubators, accelerators, and business development services (BDS) providers that can address the diverse and evolving needs of entrepreneurs at various stages of growth. The market systems should also integrate entrepreneurial education, digital innovation, and mentorship into standard business practices, with a particular emphasis on outreach to women and young people.
How will FSDT intervene?
FSDT will develop an enterprise development program to support MSMEs with training, mentorship, and advisory services for those seeking funding through FSDT’s grants or investments, as well as from the public. It will be delivered through local BDS providers, advisory firms, consultants, incubators, and accelerators. Activities include training on business planning, financial management, digital tools, marketing, compliance, CRM, and investor readiness.
What are we hoping to achieve through this intervention?
The intervention aims to strengthen women and youth led MSMEs by boosting competitiveness, financial literacy, formalization, productivity, and digital integration. Over time, it will improve investable businesses and promote innovation and sustainability in Tanzania’s enterprise landscape.
What lasting impact do we intend to achieve?
Contribute to increased economic inclusion, job creation, and sustainable livelihoods for women and youth.
INTERVENTION PERIOD
2024 - 2027
FUNDED BY
