Women Entrepreneurship In India: Possibilities & Challenges

Entrepreneurship refers to the process of developing and running an enterprise with the ability to mobilise resources and take risks to gain profit. Entrepreneurship leads to acceleration in growth and prosperity with the help of expanding economic development.

• Women Entrepreneurship refers to an enterprise started by a woman or group of women. In the past few decades, women entrepreneurship has gained pace in developed as well as developing countries.
• India has also seen an increased presence of women entrepreneurs. Women led enterprises have the ability to inspire generations while simultaneously supporting an advancing economy.

Status of Women Entrepreneurship

According to studies, there are about 14 million women owned enterprises in India. These enterprises are mainly comprised of single owner micro enterprises, providing direct employment to an estimated 22 to 27 million people. Women entrepreneurs constitute 14% of entrepreneurs in the country.

• Majority of Women enterprises comprise of Rural ‘solopreneurs’ who run rural non-farm, home-based businesses and generate supplemental household income by selling their products individually or through collectives.
• Other groups comprise of Urban entrepreneurs, Rural agricultural based enterprises, and small business owners. Women owned enterprises in India are largely small sized firms, with almost 98 percent of businesses falling in the category of micro-enterprises.
• Most of the women entrepreneurs belong to lower and middle income group and have service oriented enterprises. Further, post globalisation period, Women entrepreneurs have emerged as “techpreneurs” which is reflected in the emergence of companies such as Mobikwik, Nykaa, Zolo, Byjus etc.Over the past decade, women-owned enterprises have increased from 14% to 20%.

Factors driving Women Entrepreneurship

Women entrepreneurs comprises of 45% of India’s start-up industry. The factors that drive women led enterprises include-

• Recognition: Recognition in the form of admiration, regard, esteem and renown motivates women entrepreneurs. According to a survey by Bain & Company, more than 45% of Indian women in rural areas were driven to start a business for gaining recognition.
• Result Oriented: Women-led start-ups provide higher rate of return compared to those led by men. This ability to generate more returns encourages women to start their own businesses. Businesses led by women require less investment but generate higher net revenue.
• Education: India ranks in the top countries, producing female graduates in the science, technology, engineering and mathematics (STEM) industry, with as many as 40% of women graduating from this field. This has enabled women to run successful enterprises.

Possibilities

Women entrepreneurs hold the key to rapid economic growth of India. According to an IMF study of 2018, if measures are taken to close the gender gap in India, it could lead to a 6.8-percent gain in GDP. Advancing women’s equality could boost the GDP by about 16 percent by 2025. According to another study led by Google, if benchmarks of developed countries are adopted and the quality of entrepreneurship is improved, India could create over 30 million women-owned enterprises which can generate about 150–170 million jobs by the year 2030.

• As women entrepreneurs are often active in social areas and sectors such as health, clean energy and zero waste, education, women’s hygiene, fashion, cosmetics, food and nutrition, garments and textiles, and services, it has the potential to supplement government efforts of welfare of people in a sustainable manner.

Challenges

Women face a double set of challenges which includes generic challenges such as funding, market expertise, hiring qualified employees, and complex regulatory environment as well as gender specific challenges that are particular to women enterprises. These challenges are-

• Double Burden of Work – Women entrepreneurs face the double burden of being a caregiver and homemaker, as well as of being an economic agent generating profits. According to OECD, women are engaged in almost 6 hours of caregiving work every day.
• Access to Credit – In the Indian society, there are gendered differences in ownership of assets and wealth. Men are likely to own more wealth and income as compared to women. It hinders the possibility of receiving financial credit as they often lack adequate collateral.
• Dwarfism – As more than 98% women enterprises are micro businesses, it creates the problem of dwarfism where a vicious cycle of lack of credit, lack of marketing expertise, lack of ability to scale up the business and lower productivity holds back the women led enterprises from growing further.
• Safety – Lack of safety in public and office spaces is a major issue for women. Metropolitan cities, which are known for emergence of startup industries often lack in ensuring safety of women with high rates of women related crimes.

Though the government has initiated various schemes such as Women Entrepreneurship Platform, PM Mudra, Udyogini scheme, etc. improving access to finances, interventions in the area of mentorship and capacity building, creating role models, and push for formalisation of women enterprises will improve the entrepreneurship scenario and provide a big push to the economy.