Sero Lease and Finance (Selfina)

SELFINA is addressing the economic empowerment of women by pioneering microleasing as an effective and practical way to provide credit exclusively to women entrepreneurs in Tanzania, thereby facilitating the growth of their businesses and bringing social change to their communities. This creation of wealth-producing economic activity among poor, rural populations is especially important in a country where 75% of the population is rural and over 60% earn less than $1 per day.

Through the organization’s microleasing programme, the lessee does not have to use scarce working capital to buy equipment upfront. Rather, women become owners of leased equipment and can use it as collateral for further borrowing, freeing themselves from the poverty trap. SELFINA leases equipment such as small tractors, water pumps, irrigation equipment, sewing machines, milling machines, oil extraction machines, bicycles, motorcycles, computers and photocopiers, as well as livestock, including dairy cows, goats and poultry.

SELFINA's business consists of: financial leases (approximately 60% of total); sales and leaseback (approximately 40%). Leasing is different from, and more advantageous for women than, traditional micro-credit because leases are linked to specific assets and therefore not as vulnerable to expropriation by partners. It allows women to acquire productive assets such as sewing machines, livestock, and ovens gradually over time and use the assets to grow their businesses and earn revenue. When leases are complete, the assets become property of the women and can then be used as collateral for subsequent loans.

On the other hand, cash loans can be used for consumption or general spending and do not lead as directly to wealth creation. Furthermore, leasing has lower delinquency rates compared to traditional lending. Because SELFINA maintains ownership of the leased asset for the entire duration of the lease contract, it can threaten to or actually repossess the asset. In addition, SELFINA can rely on the cash flow generated by the customers from their businesses to service lease repayments instead of collateral or credit histories, which the poor typically lack.