What is Women Entrepreneurship? Definition, Concept, Problems

What is Women Entrepreneurship?

Women entrepreneurship refers to the process of creating, managing, and developing a business enterprise by a woman or group of women. It involves the identification of opportunities, developing and executing business strategies, managing financial resources, and taking calculated risks to achieve business objectives.

According to the general concept, women entrepreneur may be defined as a women or a group of women who initiate, organize and operate a business enterprise.

Women Entrepreneurship Definition

The Government of India has defined a women entrepreneurship as “an enterprise owned and controlled by a women having a minimum financial interest of 51% of the capital and giving at least 51% of the employment generated in the enterprise to women”.

According to Schumpeter, an entrepreneur is an innovating individual who introduces something new into the economy. Any woman (or a group of women), who innovates, initiates or adapts an economic activity may be called a women entrepreneur.

According to Medha Dubhashi Vinze, a woman entrepreneur is a person who is an enterprising individual with an eye for opportunities and an uncanny vision, commercial acumen, with tremendous perseverance and above all a person who is willing to take risk with the unknown, because of the adventurous spirit she possesses.

Kerala Government defined women industrial units as units owned/ organized by women and engages in small scale and cottage industries with not less than 80% of the total workers as women.

With effect from 6th Feb. 1992, the definition of ‘Women Entrepreneurs’ Enterprises is as follows: “A small scale industrial units/industrially related services or business enterprise managed by one or more women entrepreneurs in proprietary concerns in which she/they will individually or jointly have share capital of not less than 51% as partners/shareholders/directors of a private limited company, members of co-operative society”.

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Reasons for the Slow Growth of Women Entrepreneurship

In spite of the initiatives taken by the government, the growth of women entrepreneurship is very slow. The reasons are outlined as below:

• Unfavourable family background
• Lack of business education
• Dual role of women
• Lack of aptitudes and training
• Absence of individualistic spirit
• Lack of freedom to choose a job according to ability, influence of sex, custom etc
• Inadequate infrastructure facilities
• Shortage of capital and technical knowhow
• Lack of adequate transport and communication facilities
• Shortage of power
• Lack of security
• Absence of ideal market conditions
• Corruption in administration.

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Problems of Women Entrepreneurs

Basic problem of a woman entrepreneur is that she is a woman. Women entrepreneurs face two sets of problems specific to women entrepreneurs. These are summarized as follows.

Shortage of Finance

Women and small entrepreneurs always suffer from inadequate fixed and working capital. Owing to lack of confidence in women’s ability, male members in the family do not like to risk their capital in ventures run by women. Banks have also taken negative attitude while lending to women entrepreneurs. Thus women entrepreneurs rely often on personal saving and loans from family and friends.

Shortage of Raw Material

Women entrepreneurs find it difficult to procure material and other necessary inputs. The prices of many raw materials are quite high.

Inadequate Marketing Facilities

Most of the women entrepreneurs depend on intermediaries for marketing their products. It is very difficult for the women entrepreneurs to explore the market and to make their product popular. For women, market is a ‘chakravyuh’.

Keen Competition

Women entrepreneurs face tough competition from male entrepreneurs and also from organized industries. They cannot afford to spend large sums of advertisement.

High Cost of Production

High prices of material, low productivity. Under utilisation of capacity etc. account for high cost of production. The government assistance and subsidies would not be sufficient for the survival.

Family Responsibilities

Management of family may be more complicated than the management of the business. Hence she cannot put her full involvement in the business . Occupational backgrounds of the family and education level of husband has a direct impact on the development of women entrepreneurship.

Low Mobility

One of the biggest handicaps for women entrepreneur is her inability to travel from one place to another for business purposes. A single women asking for room is looked upon with suspicion. Sometimes licensing authorities, labour officials and sales tax officials may harass them.

Lack of Education

About 60% of women are still illiterate in India. There exists a belief that investing in woman’s education is a liability, not an asset. Lack of knowledge and experience creates further problems in the setting up and operation of business.

Low Capacity to Bear Risks

Women lead a protected life dominated by the family members. She is not economically independent. She may not have confidence to bear the risk alone. If she cannot bear risks, she can never be an entrepreneur.

Social Attitudes

Women do not get equal treatment in a male-dominated society. Wherever she goes, she faces discrimination. The male ego stands in the way of success of women entrepreneurs. Thus, the rigid social attitudes prevent a woman from becoming a successful entrepreneur.

Low Need for Achievement

Generally, a woman will not have strong need for achievement. Every women suffers from the painful feeling that she is forced to depend on others in her life. Her preconceived notions about her role in life inhibit achievement and independence.

Lack of Training

A women entrepreneur from middle class starts her first entrepreneurial venture in her late thirties or early forties due to her commitments towards children. Her biggest problem is the lack of sufficient business training.

Lack of Information

Women entrepreneurs sometimes are not aware of technological developments and other information on subsidies and concessions available to them. They may not know how to get loans, industrial estates, raw materials, etc.

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Remedies to Solve the Problems of Women Entrepreneurs

The following measures may be taken to solve the problems faced by women entrepreneurs in India:

• In banks and public financial institutions, special cells may be opened for providing easy finance to women entrepreneurs. Finance may be provided at concessional rates of interest.
  
  
• Women entrepreneurs’ should be encouraged and assisted to set up co-operatives with a view to eliminate middlemen.
  
  
• Scarce and imported raw materials may be made available to women entrepreneurs on priority basis.
  
  
• Steps may be taken to make family members aware of the potential of girls and their due role in society.
  
  
• Honest and sincere attempts should be undertaken by the government and social organizations to increase literacy among females.
  
  
• In rural areas self-employment opportunities should be developed for helping women.
  
  
• Marketing facilities for the purpose of buying and selling of both raw and finished goods should be provided in easy reach.
  
  
• Facilities for training and development must be made available to women entrepreneurs. Family members do not like women to go to a distant places for training.
  
  Therefore mobile training centers should be arranged. Additional facilities like a stipend, good hygienic chreches, transport facilities, etc., should be offered to attract more women to training centres.

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Measures Taken for the Development of Women Entrepreneurship in India

Women empowerment should be one of the primary goals of a society. Women should be given equality, right of decision-making and entitlements in terms of dignity. They should attain economic independence. The most important step to achieve women empowerment is to create awareness among women themselves.

Development of women can be achieved through health, education and economic independence. Realizing the importance of women entrepreneurs, Govt. of India has taken a number of measures to assist them. Some of the important measures are outlined as follows:

TRYSEM

Training of Rural Youth For Self Employment was launched on 15th August 1979 which is still continuing. The objective of TRYSEM is to provide technical skills to rural youth between 18 and 35 years of age from families below the poverty line to enable them to take up self employment in agriculture and allied activities, industries, services and business activities. This is a sub scheme of IRDP.

Training given through ITIs, Polytechnics, Krishi Vigyan Kendra, Nehru Yuva Kendras etc has helped many rural women set up their own micro entreprises with IRDP assistance.

BANKS

Banks particularly commercial banks have formulated several schemes to benefit women entrepreneurs. These includes Rural Entrepreneurship Development Programmes and other Training programmes, promotion of rural non-farm enterprise, women ventures etc.

NABARD

NABARD as an apex institution guides and assists commercial banks in paying special attention to women beneficiaries while financing. It has also been providing refinance to commercial banks so as to help the latter institutions to supplement their resources which could be deployed for the purpose of financing women beneficiaries.

INDUSTRIAL POLICY

The new Industrial policy of Government has specially highlighted the need for conducting special entrepreneurship programme for women.

INSTITUTIONS and VOLUNTARY ASSOCIATION

Several voluntary agencies like FICCI Ladies Organization (FLO), National Alliance of Young Entrepreneurs (NAYE) and others assist women entrepreneurs.

NAYE has been a leading institution engaged in the promotion and development of entrepreneurship among women. It convened a conference of women entrepreneurs in November 1975.

NATIONAL POLICY FOR THE EMPOWERMENT of WOMEN, 2001

As to the commitments made by India during the Fourth World Conference on women held in Beijing during September, 1995, the Department of women and children has drafted a national policy for the empowerment of women. This is meant to enhance the status of women in all walks of life at par with men.

Assistance to Women Entrepreneurs Entrepreneurship does not differentiate the sex. A number of facilities and assistance are offered to the entrepreneurs. However, certain additional incentives or facilities offered to women entrepreneurs are discussed as follows.

Small Industrial Development Organisation (SIDO)

SIDO through a network of SISIs conduct the EDPs exclusively for women entrepreneurs. The aim is to develop entrepreneurial traits and qualities among women and enable them to identify entrepreneurial opportunities etc.

National Small Industries Corporation (NSIC)

The H.P. scheme of NSIC provides preferential treatment to women entrepreneurs. It also conducts Entrepreneurs and Enterprise Building programmes for women.

Industrial Development Bank of India (IDBI)

The schemes of IDBI for women entrepreneurs are summarized as follows:

Promoter’s Contribution: The IDBI set up the Mahila Udyan Nidhi (MUN) and Mahila Vikas Nidhi (MVN) schemes to help women entrepreneurs. IDBI conduct programmes of training and extension services through designated approved agencies and association with other development agencies like EDII, TCOs, KVIC etc.

Mall Industries Development Bank of India (SIDBI)

SIDBI has special schemes for financial assistance to women entrepreneurs. It provides training and extension services. It gives financial assistance at concessional terms in setting up tiny and small units.

Commercial Banks

The “Sthree Shakthi Package Scheme” of SBI provides a package of assistance to women entrepreneurs. The consultancy wings of SBI give guidance on project identification and project viability.

The program of assistance such as repair and servicing, photocopying, dry cleaning, retail trade business enterprises, poultry farming, tailoring, etc. The Bank of India has introduced a scheme known as ‘ Priyadarshini Yojana’ to help women entrepreneurs.

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Scheme for Women Entrepreneurs

Women are becoming more active in the sphere of entrepreneurship and developing it in a dynamic way. Women have the ability to change things when they want to and they have been acknowledged for being quite constant in their growth. Women who want to work for themselves and start a business are encouraged in today’s world because of the advances their gender has achieved.

For these women who own MSMEs, the government and public institutions across the country are offering lucrative incentives to promote them and make it simpler for them to receive loans. There are age restrictions, loan limitations and conditions associated with these loans, which we urge you review thoroughly before proceeding with the loan.

However, in a nutshell, let us look at how various organisations support women through various schemes.

In India, there are nine different schemes for women entrepreneurs.

Annapurna Project

This is loan assistance for women in the food catering sector who are just starting out with their small enterprises. The loan enables these women entrepreneurs to use it for capital needs such as purchasing equipment and utensils, establishing vehicles and so on.

Women can sell packaged food items and snacks under this programme, which is one of the most typical companies that women entrepreneurs seek out and flourish in since it is something that housewives have been handling their entire lives and are used to. This increases their sales since they now have access to more finance and more items to help them launch their business than they could previously. The plan has a lending ceiling of ₹50,000.

Business Loan From Bharatiya Mahila Bank

Business Loan from Bharatiya Mahila Bank is the banking plan designed to support women and their enterprises on a wide scale. Women have dabbled in different industries and are striving for success continuously. The aim of this bank is to empower women economically with a borrowing limit of `₹20 crores.

Mudra Yojana Programme

It is a Government of India project that aims to enhance the status of women in India by offering business loans and other support so that they may become financially independent and self-sufficient. They will be handed Mudra cards, which act like credit cards and have a withdrawal limit of 10% of the loan amount, if the loan is approved.

This programme offers numerous different sorts of programmes according on the type of business, the extent of expansion and the loan goal. The government’s lending ceiling under this plan is ₹10 lakhs.

Orient Mahila Vikas Yojana

This programme is for women who own 51% of a company’s stock individually or collectively as a private concern. This is an excellent chance for these stakeholders to assist in the expansion of their firm and the advancement of their sector. This strategy does not need collateral security and offers a 2% interest rate discount. The payback time is adjustable up to 7 years and the maximum loan amount is ₹25 lakhs.

Scheme of Dena Shakti

This programme is also for women entrepreneurs, but only in the industries of agriculture, retail, manufacturing, small businesses and microcredit organisations are eligible. RBI is responsible for setting the maximum ceiling limitations for women beneficiaries. The ceiling limitations are based on the industry in which women entrepreneur are growing or launching a company. The maximum loan amount is ₹20 lakhs.

Pradhan Mantri Rozgar Yojana (PMRY)

This scheme is social and financial programmes established for women entrepreneurs. The goal of this programme is to create skill-based, self-employment opportunities for women entrepreneurs and clever brains at work who want to be financially independent. This system, which applies to both urban and rural regions, was created after various changes to the cost, eligibility and subsidy restrictions.

The loan subsidy amount set under PMRY is up to 15% of the project cost, with a per-borrower limit of ₹12,500. PMRY is applicable to businesses in the industries, commerce and service sectors. The maximum age is 35 and the maximum loan amount for a business is ₹2 lakh, while the maximum loan amount for service and industry is ₹5 lakh.

Scheme of Udyogini

This initiative promotes women to be self-sufficient and assists them in self-development by providing them with the necessary financial resources. This initiative supports aspiring female entrepreneurs by offering loans and low interest rates in compared to the private sector’s soaring rates, as well as being a reliable source of credit. Individuals with a family income of less than ₹40, 000 per year are eligible. They encourage loans in the commercial and service sectors in particular, with a ceiling of ₹1 lakh.

Kalyani Cent Scheme

The initiative is aimed for both new enterprises and those looking to develop and expand, the main distinction is that it is geared toward NOTE women entrepreneurs. The system excludes the retail trade, educa- tion and training and self-help organisations.

On their website, the qualified categories are listed in full along with the rules. This loan has no collateral requirements and no processing costs. These initiatives for women entrepreneurs allow specified groups of business women to take out loans and develop their businesses. The maximum loan amount under this plan is ₹100 lakh.

Mahila Udyam Nidhi

This programme tries to narrow the equity gap by encouraging MSMEs and small ventures to expand and succeed. Mahila Udyam Nidhi helps in rebuilding of SSI units that are inoperable but are still salvageable. The debtor is allowed ten years to repay the loan, with a maximum loan amount of ₹10 lakhs.

Indifi is another option and the greatest one in terms of the services and convenience they give when it comes to women’s business loans. This financial assistance provides a boost for women who are seeking for methods to expand and establish themselves as businesses. It is one of the most effective ways to obtain loans and assist women in obtaining excellent loans and lenders, as well as a great deal of moral support and encouragement.

Indifi is a specialist in the field of loan financing since it analyses data from a variety of sources to determine a company’s creditworthiness. By giving loans based on performance and potency, they are able to appraise the past, anticipate the future and strive toward a more resourceful present. It is beneficial for these aspiring and rising female businesses to put the money to good use.

Short-term and long-term loans, bill discounting and a variety of other money lending options are available at attractive rates, with certain loans being made collateral-free. By eliminating risk, decreasing paperwork and related fees and making it a straightforward and hassle-free process, their strategy makes it easier and more comfortable for emerging entrepreneurs to take up a women business loan.

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