Increased Digitisation Is A Boon For Women Entrepreneurs
Women entrepreneurship in India still has a long way to go. As per the Government of India’s 2021-22 annual report on the MSME sector, only 20.37 per cent of MSMEs in the country are currently led by women entrepreneurs
Multiple global studies corroborate that women’s entrepreneurship results in positive outcomes at the economic and societal levels. According to a recent Boston Consulting Group (BCG) analysis, if women and men participated equally as entrepreneurs, global GDP could rise by approximately 3 per cent to 6 per cent, boosting the global economy by USD 2.5 trillion to USD 5 trillion. However, women entrepreneurship in India still has a long way to go. As per the Government of India’s 2021-22 annual report on the MSME sector, only 20.37 per cent of MSMEs in the country are currently led by women entrepreneurs.
To increase women’s participation in creating ventures, central and state governments have launched several schemes and programs to assist them with credit, technology, infrastructure, skill training and capacity development to help increase their market presence. These programs are designed to realise the full potential of women entrepreneurs, including providing them with the right tools and support for more rapid integration with domestic and international supply chains.
However, despite all support, a basic fact remains --Women are more likely to begin their entrepreneurial journey from their homes, meaning that it is important to provide digitally enabled programs that empower and skill women entrepreneurs from the comfort of their homes and give them the confidence to scale their businesses. So, digitisation has provided women entrepreneurs with a level playing field for starting a business like no other development in recent times. There are five clear-cut benefits.
1. Overcoming Mobility Constraints: The adoption of digital technology by women entrepreneurs allows them to evaluate new business models and facilitates the realisation of entrepreneurial projects operating from the confines of their homes. For example, online payment and e-commerce innovations are simplifying their ability to trade across borders and reach new markets in a manner which less capital and less labor-intensive.
2. New Options to Access Capital: The well-known impediment of women entrepreneurs in accessing capital can be increasingly streamlined by Digital Financial Services that include payments, credit, savings, remittances, and insurance. With online platforms like Kickstarter and Indiegogo, women can now raise money from a global pool of investors. What's more, numerous venture capitalists and angel investors are now specifically looking to invest in businesses run by women. This is helping the digital financial ecosystem to take root and is changing the game for women entrepreneurs.
3. Talent Hunt is less Cumbersome: One of the biggest challenges entrepreneurs face is access to the right talent who can help them grow their businesses. However, we now have freelancing platforms like Upwork, and Fiverr that are making it easier than ever for women entrepreneurs to find talented professionals who can help them with a range of activities from marketing to web development.
4. Global Markets at a Click: In the past, another significant barrier to entry for women entrepreneurs was access to markets. However, with the internet now reaching far and deep, including rural India, women can reach customers all over the globe with just a few clicks. That's why we're seeing a surge in e-commerce businesses run by women in India.
5. Leveraging the Digital Media: A recent study by the Indian Council for Research on International Economic Relations (ICRIER) and Bain & Company found that women entrepreneurs are increasingly using digital tools to start and grow their businesses. For example, nearly 60% of women surveyed said they use social media to promote their businesses, and 50% said they use online marketplaces to sell their products or services.
Additionally, 45% said they use mobile payments to receive payments from customers, and 30% said they use online banking services to manage their finances. This is a significant change from 2006, when only 10% of women surveyed said they used social media for business purposes, and only 5% used online marketplaces.
Evidence shows that women entrepreneurs are increasingly transitioning from cash transactions to financial services like payments, transfers, savings, credit, insurance, and even securities using digital technology. Therefore, the acceleration in India’s digital economy and the simultaneous advances in financial inclusion, especially for women, will become a key driver in the growth of women’s entrepreneurship in India.
Having made a strong case for digitisation providing a fillip to women’s entrepreneurship in India, it is important to simultaneously address the issue of digital literacy among many women entrepreneurs. To have a strong online presence, a well-designed website optimised for search engines and buzzing social media handles, digital literacy becomes an essential skill. The faster we bridge this digital divide, the faster the benefits of digitisation will accrue to women entrepreneurs.
(The given article has been written by Atul Raja is Executive Vice President, Global Marketing at Wadhwani Foundation)
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