ABSTRACT Recently, there has been a resurgence of interest in the implications of emerging barriers to women entrepreneurs due to their impact on the realisation of Sustainable Development Goals. Thus, this study examines the effects of funding mechanisms on women entrepreneurs' ability to employ other women in Africa. This study employs causal mediation analysis and Bayesian model averaging on World Bank Enterprise Survey data spanning 44 countries from 2006 to 2024, to quantify the effects of internal reserves, equity stakes, and bank lending on female hiring. The empirical findings reveal that reliance on internal funds and obstacles to bank finance significantly dampen women's ability to expand female employment. These disparities reflect discriminatory lending practices, pushing many women into entrepreneurship out of necessity rather than opportunity. However, firms with substantial female ownership are more likely to promote women into leadership roles, narrowing workplace gender gaps. Hence, to mitigate these inequalities and bolster women‐led job creation, this study recommends targeted interventions that include start‐up grants, loan guarantees, and gender‐sensitive credit policies. In addition, enhancing women entrepreneurs' access to finance can empower them to hire and advance women, closing labour gender gaps, improving leadership roles, and accelerating Africa's inclusive progress toward the SDGs.
Iliyasu et al. (Sun,) studied this question.