Introduction
While India has made significant progress in women’s economic participation, gender disparities in entrepreneurship, employment, and access to finance remain stark. Despite increased participation in SHGs (Self-Help Groups) and government-backed loan schemes, women entrepreneurs still face funding and credit access challenges.
Gender Disparities in Finance and Entrepreneurship
A. Startup Funding Gap
- Male entrepreneurs raised $10.8 billion for tech startups in 2004, while women-founded firms secured only $1 billion.
- India ranks 57th out of 65 countries in female entrepreneurship progress.
- Women-led enterprises account for just 13.76% of all businesses, contributing 17% to GDP (global average: 37%).
B. Employment and Workforce Participation
- Only 19.2% of Indian women participated in the workforce in 2022 (ILO data).
- In financial markets, the gender ratio is 20:1 in equity dealing rooms.
- Female Labour Force Participation Rate (LFPR) rose from 23.3% in FY18 to 37% in FY23, driven by rural employment initiatives.
Government Initiatives Supporting Women Entrepreneurs
A. Lakhpati Didi Scheme
- Ensures ₹1 lakh minimum annual income for SHG women members.
- 11.5 million women have become ‘Lakhpati Didis’ through the initiative.
B. Financial Inclusion and Credit Access
- Pradhan Mantri Jan Dhan Yojana (PMJDY): 303.7 million of 545.8 million bank accounts belong to women (as of January 2025).
- Pradhan Mantri Mudra Yojana (PMMY):
- 68% of loans sanctioned to women entrepreneurs.
- 77.7% of Stand Up India beneficiaries are women.
- However, while women hold 67.92% of Mudra loan accounts, they receive only 44.46% of total credit sanctioned.
Declining Trends in Women’s Access to Credit
A. Decline in Women Borrowers under Mudra Scheme
- SFBs (Small Finance Banks): Women borrowers dropped from 1.8M (FY22) to 700K (FY24).
- Private Banks: Women borrowers declined from 4.5M (FY22) to 1.1M (FY24).
B. Fluctuating Loan Disbursements
- Public Sector Banks (PSBs): Loans to women fell by ₹4,000 crore (FY22), rose by ₹41,000 crore (FY23), then fell ₹21,000 crore (FY24).
- SFBs: Declined from ₹10,000 crore (FY22) to ₹7,000 crore (FY24).
- Microfinance Institutions (MFIs): Fluctuated from ₹2,000 crore (FY22) to ₹18,000 crore (FY23), then dropped to ₹10,000 crore (FY24).
Past Efforts and Challenges in Women-Centric Banking
- Bharatiya Mahila Bank, a dedicated women’s bank, failed due to limited outreach and operational inefficiencies.
- Women-led cooperative banks (e.g., SEWA Bank, Mann Deshi Bank) remain geographically restricted.
- Jan Dhan Plus (2019) by Bank of Baroda and Women’s World Banking (WWB) aims to improve women’s savings habits.
Bridging the Gender Gap
- Increase Gender-Specific Financial Products
- Expand Jan Dhan Plus across banks.
- Introduce higher credit limits for women-led startups under government schemes.
- Improve Credit Disbursement to Women
- Address funding disparities in Mudra loans by revising lending policies.
- Encourage higher investment from private VCs in women-led businesses.
- Enhance Women’s Entrepreneurial Ecosystem
- Set up women-focused startup incubators.
- Strengthen mentorship networks for female entrepreneurs.
- Scale Up Successful Models
- Expand SHG-led entrepreneurship programs like Lakhpati Didi.
- Improve financial literacy and digital banking access for rural women.
If India aims to achieve developed nation status by 2047, narrowing the gender gap in entrepreneurship, employment, and finance is critical. While progress is evident, sustained policy action, better access to credit, and cultural shifts are essential for women to thrive in India’s economy.
Source: BS
