Brave new world of women entrepreneurs
The gig economy presents a significant opportunity for women's entrepreneurship, and the government needs to support the private sector in its business models.
One of the pillars of India’s G20 women-led development agenda is the promotion of women’s entrepreneurship. According to several studies, if women were represented in the formal economy on par with men, the Indian economy would grow by an additional 60% by 2025, adding $2.9 trillion. At present, only about 14% of all enterprises in India are women-led businesses. The sixth economic census says that women entrepreneurs account for 13.76% (about 8.05 million) of the total entrepreneurs of 58.5 million in India. Undoubtedly, there has been a growth in the number of women entrepreneurs, but it has been patchy and slow and needs to be stepped up.
The existing women-led enterprises employ 30% of India’s female workforce with the capability to create around 150 million jobs by 2030. But there are many gaps that hold women back as identified by a research study by MicroSave Consultancy. One is the lack of space, capital, and support to get started. By and large, in India, we do not have physical incubation/acceleration spaces that recognise the unique challenges faced by women entrepreneurs. Among these are the need for shared services (legal, accounting), exhibition space, mentorship and peer to peer support. Women in tier 2 and tier 3 cities also need online/hybrid support that takes into account the time and mobility constraints of women entrepreneurs.
An enormous challenge that aspiring women entrepreneurs face is access to finance. Most financial products are not designed or delivered in a manner that is tailored to their needs. Issues around collateral and gendered approaches to loans lead to women having to borrow from the informal sector or remain in low capital/low growth enterprises. What we need are appropriate financing solutions which begin bottom up, tailored to the requirements of women entrepreneurs. The delivery and design of these cannot be based on the old models but through innovative approaches after consulting the women.
Yashodhara Bajoria, co-founder, CAXpert, an online accounting platform that provides low-cost accounting solutions and financial analytics to small business owners says, “Categorising entrepreneurs based solely on traditional factors like turnover and investments is limiting. To truly empower entrepreneurs, we need insights into their mindset and approach. Compliance psychology provides this crucial understanding. It not only aids resource allocation but also informed policy development. At CAXpert, we believe this is where meaningful change begins.”
Women entrepreneurs and aspiring ones have suffered for lack of a collective voice. There is no single collective focused on promoting women’s entrepreneurship. This has several fallouts, among them the lack of negotiating power, lack of agenda setting ability, lack of ability to shape the narrative on critical issues and a lack of visibility on tailwinds, trends and opportunities.
In the past, we have had models like SEWA and Lijjat papad, among a few others, that have shown what could work for mass women entrepreneurship. But beyond that, no new models which keep in mind changing technologies and access routes to finance have come up which can be scaled across geographies. There is also a significant gap in women’s entrepreneurship models designed for urban and rural areas.
The greatest potential today for women’s entrepreneurship lies in the gig economy, which is estimated to grow to 2.35 crore (23.5 million) workers by 2030. This has been boosted by the growing use of smartphones, internet penetration, education and digital payments infrastructure. The government has to do much more to support the private sector to identify, test and validate business models that are suitable for women entrepreneurs. The G20 summit has laid out the aspirations, now for the implementation.
The views expressed are personal