Competitions Gender Partnerships

Multiplying the Money for Women in Business

The 2XChallenge publicly challenges big lenders to invest with a “gender-lens” and mobilise USD 15 billion for women-led businesses.

In the past, many women may have gone into business out of necessity. Today, more and more women become entrepreneurs out of desire and determination. And more and more policy makers know that this is in everyone’s interest: women who lead businesses create prosperity and promote development.

Yet, women business leaders continue to face big obstacles. Everyone knows about the big gender pay gap, for example. What fewer people realize is that women also suffer from a huge credit gap. The International Finance Corporation estimates that 68% of women-owned businesses worldwide have unmet credit requirements. In Uganda, women own 40% of all registered businesses – among the highest rates in the world! Yet these businesses account for only 9% of all credit allowances.[1]


Investing in women makes perfect economic sense. On average, women are better borrowers, and their enterprises tend to perform better, with higher sales growth, earnings per share and return on assets. For example, companies founded by women deliver twice as much revenue per dollar invested. And gender-balanced leadership teams in private equity generate a 20% higher net internal rate of return.

As a result, financial exclusion leaves both billions of women and billions of dollars behind. The OECD estimates that gender discrimination reduces global income by 7.5%, a total loss of USD 6 trillion. The World Bank finds that 1 billion women do not have access to banking services. For banks, this represents a loss of USD 330 billion in revenue and USD 500 billion in insurance premiums. Meanwhile, according to Women’s World Banking, in 2019, the Boston Consulting Group estimated the impact investing market at USD 715 billion, but found that only 1 percent of these dollars is invested with a gender lens.  


Launched by G7 development finance institutions (DFIs) in 2018, the 2XChallenge aims to help close the gender credit gap. The “2X” idea is simple: create a multiplier effect! To begin, the aim is to build peer pressure, encouraging development finance institutions (DFIs) to make public commitments to mobilise more loans for women-owned businesses. In turn, DFI investees – like regional or national banks – will have strong incentives to adapt their own investment criteria, prioritising women-owned businesses in their own loan requests and offers to customers.

What is Gender-Lens Investing?
Gender-lens investing is the practice of investing for financial return while also improving economic opportunities, inclusion and social wellbeing for women and girls.
The term was coined about a decade ago. For its proponents in the development community, gender-lens investing brings enormous potential. By crowding in billions of dollars in capital, it can carry more weight than other funding modes.

In order to qualify for the challenge, investments need to meet one of several criteria. For example, businesses receiving loans need to be more than half-owned by women, have 20-30% women in senior leadership or supply products or services that specifically benefit women. Each participating member applies the 2X gender lens criteria to their portfolio and reports it to 2X Challenge. 

The founding 2XChallenge institutions initially set themselves a target of USD 3 billion. By the end of 2020, the initiative had mobilised more than USD 11.4 billion in capital – more than three times their initial target! This includes both the DFI’s own funds (about USD 7 billion) and loans from other public lenders and private investors.

Phrased in simple and accessible terms, the criteria have turned out to be an influential tool[2] for advocacy and have helped crowd in investors. Since the initiative began, the number of financial institutions participating in the initiative has grown to 18 and, at the G7 Summit in June 2021, 2X Challenge members announced an ambitious new fundraising goal of USD 15 billion in 2021-2022.

The 2X Challenge members now want to grow the field of gender-lens investors with the help of a new 2XCollaborative. The aim is to provide a much broader group of investors – beyond development finance institutions – with opportunities to learn from one another, find partners, and access research, data and training on gender-lens investing. Among others, the Investment Leadership Network, with combined assets of over USD 5 trillion, is to join the 2X Collaborative.


There is a long way to go in achieving gender equality. Pervasive gender stereotypes continue to define what is “normal”.  The World Economic Forum estimates that, at the current rate of progress, it will take 267 years to close the world’s economic gender gap.

The COVID pandemic has not helped. In fact, it has exacerbated inequalities. Women are much more likely to work in sectors hit hard by COVID-19, including retail, accommodation, and the food and beverage industries. They have been carers on the front line of the crisis, representing 2 in 3 health workers worldwide.

To achieve the Sustainable Development Goals and address the impact of the pandemic on women, we need a recovery that is gender-smart. Initiatives like the 2XCollaborative can help shift the norms and practices that shape our world and build recognition for the role of women as leaders.

One example is the SheInvest initiative of the European Investment Bank (EIB), which used the 2X criteria to mobilise €1 billion in gender-lens investment across Africa in its first year, providing African women with better access to finance and more relevant services and products. The EIB has decided to double its ambition and mobilise €2 billion of gender-responsive investment across the continent.

The 2X Challenge provides valuable insights for communicators: as so often, what gets measured gets done. Setting measurable targets can help raise attention to an issue. Captured in a simple, sharable infographic, the 2X Challenge criteria help explain what gender lens investment and consumption means.

The criteria also help increase peer pressure and provide incentives for people to change their attitudes and behaviours. When these behaviours include investment decisions and new market opportunities, we can change the way capital flows and have a real impact on the world.

As communicators, we can then inspire further action by sharing impact stories online or at events. For example, have a look at the videos and blogs about the 2X Challenge. Amplifying the voice of women benefiting from the 2X Challenge serves as powerful proof of the effectiveness of the initiative. The growth in members and financial targets of the 2X Challenge is thus also a result of great communications.

[1] For a deeper look at gender discrimination in Uganda, read the 2015 SIGI Uganda Country Report.

[2] The 2xChallenge initiative helps to put into practice OECD’s Development Assistance Committee (DAC) gender equality policy marker, which tracks and analyses how development finance supports gender equality and women’s rights.

This post is the result of a collaboration of the European Investment Bank and OECD Development Communication Network (DevCom), and was drafted in partnership with Engagement Global.

For more information about the 2X Challenge and 2X Collaborative, please Contact — 2XCollaborative.

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