Women MSMEs in India play a critical role in generating high rates of employment growth and accounting for a major share of industrial production and exports. Production from the MSME sector accounts for 15% of India's GDP and the sector is estimated to employ around 70 million people. Collectively, women employ over 8 million people, contributing 3.09 percent of industrial output. Yet few Indian women seem to take up early-stage entrepreneurship compared to men. Only 33 percent of early stage entrepreneurs in India are women (GEM, 2014).
Given this backdrop, the key objectives of this study were to:
- Understand the current credit availability to women owned MSMEs in the country
- Measure the efficacy of financial schemes offered by banks or sponsored by the Government in reaching the intended credit to women
- Obtain the providers' perspective on the efficacy of support schemes and issues in administration of loans to entrepreneurs
- Understand the issues and challenges women owned MSMEs face in accessing credit
Key findings include:
- Lending patterns: Analysis of secondary data shows that most Public Sector Banks meet the 5% lending threshold set by the RBI (on their Adjusted Net Bank Credit) to women, across segments.
Why are women owned MSMEs financially excluded? This includes supply and demand issues.
