A lack of access to funds is one of the biggest hurdles Indian women face in pursuing entrepreneurship.
The country is among the worst-ranked in the progress of women in business, according to the Mastercard Index of Women Entrepreneurs 2021 (pdf). Female entrepreneurs rely mostly on self-financing—largely their savings—inherited assets or physical property that can be mortgaged.
Countries like Nigeria, Uganda, Vietnam, and the Philippines fared better despite socio-cultural barriers and infrastructural constraints there.
Not a level playing field in formal finance
What’s worse is the perception among formal lenders that women-led ventures are risky. Most research, however, points to the contrary.
The benefits of several government schemes, too, were largely limited to small-ticket loans.
“Though there has been a rise in women’s share in bank credit in the past few years, which in itself is a positive sign, the increase has been in short-term categories of personal and consumer durable loans,” Sunaina Kumar, a senior fellow at policy think tank Observer Research Foundation wrote.
While the number of bank accounts held by women has risen, it does not imply the availability of funds. A study in 2020 showed that women received only 27% of the deposits they contributed as bank credit—for men, the figure stood at 52%.