(ERGO) – Fadumo Hasan Mohamed, an entrepreneur in Mogadishu, is facing the collapse of her beauty salon that she opened in January and was once bustling with clients and employees.
In October, she faced a turning point when her staff began to leave due to unpaid wages, and shortly afterwards her electricity was cut off because of unpaid bills.
Like many other Somali women with ideas and drive, Fadumo’s principal challenge has been the lack of access to financial capital.
She faced numerous rejections from local banks where she applied for loans, leaving her without the resources to develop and sustain her business.
She feels defeated by the barriers, stating that she has little optimism for the salon’s recovery. Only two of her original 12 employees remain, and they have not been paid since September.
Fadumo’s business journey started with a modest $1,000 investment, half of which she borrowed from a family member and has yet to repay. Her family, also facing financial limitations, was not able to lend her any more money.
At first the business supported her six-member household, but as months passed her income dwindled and clients began going elsewhere because of disruptions caused by power outages.
“I had customers waiting, but they left when the electricity was cut. We ended up using flashlights to finish some jobs,” she said, illustrating the frustration caused by financial constraints.
Fadumo, who graduated with a degree in healthcare from Mogadishu University four years ago, turned to entrepreneurship after being unable to find a job in her field.
Family members and friends often tell her to abandon her ambitions and stay home, but Fadumo remains determined to stay true to her dreams of becoming a successful businesswoman, despite cultural expectations that discourage women from pursuing independent careers.
Financial experts in Somalia recognise that Fadumo’s experience reflects broader economic challenges facing women.
A lecturer in business and economics at Mogadishu University, Warsame Mohamed Hassan, explained that women in Somalia often struggle to access business loans. Banks tend to favour men who can rely on established social networks and traditional elders, giving them more access to financial support.
Cultural attitudes reinforce these challenges, with societal norms often casting doubt on women’s ability to run successful businesses. According to Warsame, societal stereotypes make it hard for women to secure collateral for loans, limiting their ability to build and expand their businesses or improve their financial standing.
Another female entrepreneur, Maryan Abdikadir Osman, 26, encountered similar challenges in her small business producing oil from coconuts and peanuts. Since 2022, Maryan has repeatedly approached banks for a loan to buy machinery to scale up her production, but her applications have been rejected.
“If I got investment, I could open a proper business. I could bring in two machines. Sometimes, when people call or are given my number, the first question they ask is, where are my premises located, and I don’t have an answer,” she said.
Without any machinery, she transports raw materials over a kilometre from her home to the nearest available facility where she can manually process the oil products
Maryan’s business provides her only income to support her three children, and she relies on social media to promote her products.
“If you are working without machines or funding and still trying to make things happen without any resources, it’s really an achievement!” she said.
Maryan graduated with a degree in management and turned to entrepreneurship when she failed to find a job.
Even with a high level of education, women like Maryan and Fadumo – both striving to improve their families’ lives and contribute to the country’s economy – lack the funding they need to move forward.
