Prime Highlights :
- Women in Somalia are starting small businesses to support income in a challenging economic environment.
- Home-based enterprises are growing as women use simple tools like mobile phones and social media to reach customers.
Key Facts :
- A large share of jobs in Mogadishu and other cities comes from small business activity, with women playing a key role.
- Many women entrepreneurs face limits such as lack of funding, limited access to formal markets, and reliance on informal networks to run their businesses.
Background :
In Mogadishu and other Somali cities, young women who do not have many job options are starting small businesses from home. They use mobile phones, social media, and word of mouth to sell clothes, food, and services. This is not just because of ambition. In a country where formal employment is scarce, self-employment has become a survival strategy, and women are leading it.
The numbers tell a striking story. Entrepreneurship drives an estimated 76% of all jobs in Somalia. Women in Mogadishu and Bosaso operate approximately 45 percent of registered formal businesses while they also manage numerous home-based businesses that remain unrecorded in official statistics.
The gap between participation and growth remains large. A World Bank survey found that only 21% of women-owned businesses in Somalia could access overdraft facilities, compared to 46% of businesses overall. Under the country’s key lending programmes, Gargaara MSME Financial Facility, women-owned businesses accounted for nearly half of all loans by number, but received less than 10% of the total loan value disbursed.
Not just financial, but limited collateral, gaps in financial literacy, gender bias in loan approvals, and social and cultural expectations are the barriers that restricts growth of women-led businesses. Most remain informal, which cuts them off from training, larger supply chains, and long-term stability.
Progress is happening, but slowly. IFAD, in partnership with the Somali government, launched the Somalia Women’s Market Access Open Innovation Challenge in 2025 to connect rural women entrepreneurs with markets, financing, and business development support, recognising that real growth requires more than microloans alone.
Somalia’s woman-led businesses pose an under-leveraged economic resource for the wider development and the private sector community. With the required policy, a far better credit, and a significant linkage to the market, the craft could grow more than just survive.
