Women's access to finance: An incomplete story

If India wants to be recognised as a developed country by 2047, narrowing gender gap in the labour market is as important as women's access to finance

- TAMAL BANDYOPADHYAY

Male entrepreneurs raised $10.8 billion for tech startups in 2004; in contrast, women-founded firms attracted only $1 billion.

Residential transactions by women buyers rose 14 per cent in 2024, while property purchase by men rose 11 per cent.

Even though about 20 per cent of financial sector employees are women, in equity dealing rooms, the gender ratio is 20:1—one woman dealer for every 20 men.

These, and many more reports, appeared in financial papers last Saturday, as we celebrated the International Women's Day.

At the Republic Day parade on January 26 this year, the rural development ministry's tableau on the Lakhpati Didi drew much attention. It showcased women's economic empowerment through entrepreneurship focusing on the Lakhpati Didi scheme, which aims to ensure a minimum income of ₹1 lakh to members of self-help groups (SHGs).

According to the ministry, at least 11.5 million women SHG members have become 'Lakhpati Didis'. So far, over 100 million rural women have joined close to 99 million SHGs. Around 300 of them, the 'Lakhpati Didis', attended the R-Day parade as special guests.

This is significant when we look at the role of women in entrepreneurship in India. NITI Aayog data show women account for just 13.76 per cent of entrepreneurs, contributing 17 per cent to the GDP, well below the global average of 37 per cent. Going by International Labour Organisation (ILO) statistics, in 2022, just 19.2 per cent of Indian women participated in the workforce, highlighting a significant employability gap.

Finally, India ranks 57th out of 65 countries in female entrepreneurship progress and success.

Why do we have such a low ranking? Only 20 per cent of India's 61 million micro, small and medium enterprises (MSMEs) are led by women, almost half of which operate in rural areas. Women lead 5.26 per cent of small and 2.67 per cent of medium enterprises.