Empowering women with financial inclusion to break the cycle of poverty

This story is part two of a three-part series on how marginalized women and mothers will drive change when they’re empowered as decision-makers, and with financial inclusion and support networks.

Read on to see how Unbound empowers women and mothers with financial inclusion. Also see Part 1: “Empowering women with decision-making,” and stay tuned for Part three: “Empowering women to drive change in their communities.” coming later this month.

Women’s economic empowerment is essential to achieving women’s rights and equality.

However, women in developing economies are less likely to have access to financial institutions and to participate in the labor market or, if they do, are more likely to hold informal jobs.

According to the United Nations, women in lower- and middle-income countries are often observed having higher rates of entrepreneurship than men because decent job options are scarce. However, women face more disadvantages to starting businesses, often struggling later on to maintain the business due to the inequality they face.

When women work, the UN posits, economies grow. Education, upskilling and re-skilling are “critical for women’s rights and girls’ health and wellbeing, as well as their income-generation opportunities and participation in the formal labor market.”

Under Pillar 2 of Unbound’s 2030 Strategic Plan, the organization is working to empower 350,000 women with financial inclusion, awarding at least $1 million in grants to accelerate the success of female entrepreneurs.

Women and mothers empowered with financial inclusion through grants or loans

Over 35,700 families have already started or enhanced their small businesses with the support of Unbound sponsorship or microloans. Globally, mothers in Unbound’s small groups and savings cooperatives hold $11.5 million in combined total savings available for participating families to access for business capital or other needs.

In 2024, 91% of all Unbound small business grants were awarded to women — including mothers, aunts or grandmothers of sponsored children.

Unbound President and CEO Ashley Hufft said that more and more mothers in the organization’s programs are creating and scaling up small businesses as a primary source of income, savings and stability for their families.

Sisi, a mother from Peru, and Madhuri, a mother from India, are women entrepreneurs who have expanded their small businesses and improved their families’ lives thanks to financial inclusion.

Sisi enhanced her bookstore with the help of an Unbound Small Business Accelerator grant of $1,700 USD, while Madhuri took out a loan of $238 from her Unbound mothers group to start her bread-baking business.

In Peru, the share of the poor living in urban areas currently exceeds 60%. Peru is a country most affected by the COVID-19 pandemic in terms of economic impacts and the erosion of social gains, according to the World Bank. 

Over half of households in Peru still lack access to one or more essential services such as drinking water, sanitation and electricity. Many of capital city Lima’s poor live in informal settlements called shantytowns that are characterized by a mix of makeshift housing and the absence of basic infrastructure.

Sisi, 25, lives in one of these informal settlements with her husband and 6-year-old son. She describes herself as “a fighter” who always had an interest in entrepreneurship. As a child, she used to buy and sell erasers to her classmates, and as an adult, she’s had multiple businesses, including a diner and a clothing shop. But her husband’s employment was informal, and just before their son was sponsored, they had days when they weren’t sure if they’d eat a meal.

Sisi received Unbound’s Small Business Accelerator grant to boost her current business, a community bookstore. With the $1,700 USD grant, she bought stock for her store and invested the rest into renovating the space — something she did with the approval of her landlord and an agreement for three years rent free.

But the grant wasn’t the only benefit to Sisi. Unbound Lima staff also hosted business training three days per week for grantees where she learned tips for marketing, buying and selling, and how to understand and manage her business profits.

According to Hufft, helping women and mothers gain financial literacy to manage their businesses is essential to their success.

“Financial literacy provides a sense of empowerment to battle discrimination, abuse and fraud,” Hufft said. “It is a key part of women being able to have full control over their personal and business lives.”

Thus far, Sisi’s business has been so successful that the family plans to create space to open a hardware store, which her husband will run.

Hufft, who travels regularly to Unbound’s programs globally, said that she witnesses how skilled mothers are at making the most out of opportunities provided to them.

“Mothers are able to juggle and work tirelessly each day in their multiple roles as wives, mothers, caregivers of elder relatives, primary breadwinners and as entrepreneurs to improve their families’ quality of life,” Hufft said. “Each day, we see their resilience in the face of legal, cultural and familial challenges. They continue to rise and step forward to chart their families’ paths out of poverty.”

Madhuri is one such mother who continues to rise and step forward to greet each day with determination.

Madhuri’s daughter is a sponsored youth through Unbound, and the family of four live in a rural, indigenous village in Bhagalpur, India, surrounded by forests and rice fields. In a village of only 800 to 1,000 residents, Madhuri’s family has limited opportunities to make sustainable income.

Gender barriers between girls and boys in India often expand as they grow into adults because of deeply entrenched patriarchal views, social norms and traditions. According to UNICEF, while boys tend to experience greater freedom, girls in India tend to face extensive limitations on their ability to move freely and to make decisions affecting their work, education, marriage and social relationships.

Though Madhuri was a college graduate and dreamed of being a teacher, she stayed home to take care of her family instead, as her husband worked as a day laborer.

Unbound’s Bhagalpur program works to motivate the families of sponsored children to seek new income-generating resources through livelihood training. It was through participation in her Unbound mothers support group that Madhuri was motivated to start her own business.

Using some of the savings from her child’s sponsorship funds, combined with a loan from her mothers group and some of her own savings selling pigs and goats, Madhuri invested a total of $836 to start a bread-making business from her home in 2018.

Madhuri is the only bread maker in her village. Juggling her domestic duties, her day begins at 4 a.m., preparing the bread deliveries, and concludes by 9 each night. Today, her business has grown to include help from her husband and two employees. The business produces over 2,400 pieces of bread a day to supply to stores in the village and for special orders from individuals.

Madhuri has gained respect in her village and has been able to support her family’s needs while also providing a much-needed service to her community. She’s saving her profits now to support her children’s higher education needs.

Madhuri said lack of choices in India keeps more women from being business owners.

“The training [through Unbound] empowers us women to contribute to our family’s needs and to the society,” Madhuri said. “I want to encourage other women to work hard for your own dream. … Believe in yourself that you can do everything.”

Part three of Unbound’s Empowering Women series explores how self-help groups called mothers groups and community service opportunities empower women to drive change beyond their own families. Read Part 3 in the series, “Empowering women through mothers groups and community-led initiatives."

Unbound’s regional reporters in Latin America and Asia contributed information and photos for this story.