MSME

3-Year Insights on Surge in Women-led MSMEs

India’s economic growth story has evaded a massive section of micro, small, and medium enterprises (MSMEs), the smallest enterprises led by women. It is demonstrated by the fact that, even though MSMEs are becoming more and more prevalent in India, women-owned MSMEs employed 11% more women than male-owned MSMEs, and that one-third of all new jobs created by MSMEs owned by women went to women employees, thereby stimulating local economies and increasing the proportion of women in the workforce.

The landscape of women-owned micro, tiny, and medium-sized enterprises (MSMEs) in India has significantly transformed in the past few years. This post will highlight 3-Year Insights on Surge in Women-led MSMEs.

Overview of 3-Year Insights on Surge in Women-led MSMEs

Over the last three years, new data indicates that the number of women-led MSME certificates and registrations on the MSME portal (Udyam Registration Portal) has multiplied, indicating an increasing spirit of entrepreneurship among the fairer sex in conjunction with the government’s enabling mechanism.

 In that regard, the Reserve Bank of India’s Department of Financial Inclusion and Development reported that, as of March 31, 2023, the percentage of women-owned MSMEs registered in India that made up the outstanding MSME credit of Scheduled Commercial Banks was 7.09%.

It shows a substantial improvement over previous years and indicates that women entrepreneurs now have better access to financial resources. Therefore, the government has launched a few steps to boost this growth further. In addition to the regular 75% protection, the Credit Guarantee Fund Trust for Micro and Small Enterprises offers women entrepreneurs 10% off annual guarantee fees and an additional 85% cover.

The following table provides specifics on the guarantees granted to female entrepreneurs, particularly under the CGTMSE, over the last three years:

Fiscal Year	Number of Guarantees	Amount (₹ Crore)	Percentage of Total Guarantees	Percentage of Total Amount
2021-22	1,39,244	8,021	19%	14%
2022-23	3,65,582	16,373	31%	16%
2023-24	4,25,865	32,223	25%	16%
Cumulative	19,30,188	94,296	22%	15%

Besides, thanks to the Prime Minister’s Employment Generation Programme, new micro-enterprises in the non-farm sector can now be established with credit-linked subsidies. In rural areas, women entrepreneurs receive a 35% margin money subsidy, whereas in urban areas, it is 25%.

Most lately, there has been a significant surge in the registration of women-led MSMEs on the Udyam Registration Portal. This number increased by 75% from 4.9 lakh in the 2020–21 fiscal year to 8.59 lakh in the following year. The 2022–2023 fiscal year saw this situation improve; additional growth is anticipated in the current fiscal year.

These patterns demonstrate how well-targeted entrepreneurship initiatives and financial assistance for women have been in India. Prospects seem promising for women-led MSMEs as the government continues to work on its committed initiatives to ease access to economic resources and encourage entrepreneurship.

However, MSME Registration is not just a formality, it’s an essential step to ensure that your business is positioned to leverage these opportunities and contribute to the growing landscape of women-led enterprises in India.

Characteristics of Women Entrepreneurs

A woman entrepreneur must complete every task necessary to launch a business. These include concept generation and screening, goal-setting, project planning, product analysis, etc. The crucial traits of female entrepreneurs are as follows:

·  Employment of Women

A female entrepreneur gives women at least 51% of the jobs her business creates. As a result, she is essential to a nation’s economic growth since she creates jobs for women in the community.

·  Risk Taker

A woman business owner takes up the business’s risk. Uncertainty is synonymous with risk. It is not knowing how a choice or action will turn out. She assumes risk, meets uncertainty head-on, and takes calculated chances.

· Good Organiser

Women entrepreneurs are remarkably adept at managing people and tasks. They choose people objectively based on how well they can solve particular problems. They combine different production elements, minimise losses, and lower production costs. A female entrepreneur creates and oversees the implementation of business ideas. She makes a product for the market by combining several production components.

· Foresight

Women business owners are adept at anticipating business landscape changes. Stated differently, they clearly understand the expected shifts in the market, consumer preferences and attitudes, technology advancements, etc., and promptly and appropriately respond to these changes.

· Decision Maker

A woman entrepreneur must make several decisions when carrying out the tasks associated with her business. She must, therefore, use creativity when making decisions.

True entrepreneurship necessitates the capacity to solve problems creatively, logically, and quickly and correctly make decisions. An entrepreneur’s ability to make decisions directly impacts the productivity and profitability of their business.

· Self-Confident

A female entrepreneur needs to possess self-assurance. She needs to believe in her skills and abilities. She ought to be able to take on challenges confidently and independently. The only person who can trust people and give them authority is a self-assured business owner. She should be confident enough to adjust, given her pertinent education, training, and experience.

· Visionary

Vision is the capacity to visualise objectives while working towards their accomplishment. Every business owner has aspirations for expansion and improvement. A female entrepreneur develops fresh concepts, launches her business on them, and, via her initiative, adds value to society. She devises plans to turn the idea into reality with perseverance and tenacity.

· Hard Work

Women entrepreneurs put in a lot of work to succeed. Since most female entrepreneurs think perseverance is the key to success, they typically put in a lot of effort first and make it a lifetime habit.

· Optimistic

The mindset of female business owners is upbeat. They are unaffected by the issues they are currently facing. They start to feel hopeful about the future, believing that things will improve for businesses.

· Creative

The ability to think creatively is a prerequisite for an entrepreneur to handle challenging situations and address various challenges; a woman entrepreneur needs to possess both innovative thinking and a reasonable level of intelligence.

· Interpersonal Skills

A woman entrepreneur is someone who interacts with a variety of people. She has to interact with a wide range of people. With the assistance of others, she is the one who completes tasks. Therefore, a successful female entrepreneur has people-related interpersonal abilities.

· Leadership and Team Spirit

A woman business owner needs to be able to form productive teams and collaborate with others. She ought to be skilled at assembling and leading productive teams. The most vital feature of a woman entrepreneur is her leadership ability. It motivates and encourages people to put their best effort into pursuing goals.

Problems faced by Women Entrepreneurs

While growing the business they had founded, female entrepreneurs encountered numerous obstacles. The problems are unique to them and issues that affect all entrepreneurs. It is possible to analyse the primary problems that female entrepreneurs confront as follows:

1. Problems of Finance

Regardless of size, finance is considered the “lifeblood” of any organisation. Getting the backing of bankers, handling working capital, and not having enough credit resources are the issues that still affect men. Research has indicated that even well-educated contemporary women entrepreneurs in developed and developing nations face challenges securing loans.

Banks discourage female borrowers because they’ll revert to homemakers and abandon their businesses. Even if the loan application process has been dramatically streamlined, it is still difficult for women. Thus, the lack of financing is the reason why women entrepreneurs fail.

2. Scarcity of Raw Material

Obtaining raw materials and other critical inputs might be challenging for female businesses. The primary cause of the collapse of numerous co-ops in 1971, including those involved in the production of baskets, was the scarcity of raw materials derived from forests. The two most significant issues facing entrepreneurs are high raw material costs and obtaining raw materials at the lowest possible discount.

3. Competition

Many disorganised female-owned businesses must contend with fierce competition from established industries. Thus, this intense rivalry forces women’s businesses out of business.

4. Lack of Education

Women’s literacy rates are meagre in India. Most women are ignorant of recent technological advancements, marketing strategies, creative planning of businesses, alternative marketplaces, etc. Since they did not receive a sufficient education. Insufficient knowledge and expertise lead to issues while establishing and managing commercial ventures.

5. Low Risk-bearing Ability

Women have had more protected lives than men; therefore, they are less able to withstand financial and other dangers. They frequently encounter prejudice when choosing an entrepreneurship training program. All of these lessen their ability to take on the risk involved in running a business. Being willing to take risks is a crucial requirement for a successful business.

6. Family Responsibilities

In India, women primarily care for the children and other family members. Her dedication to her family takes up little of her time and energy for work. Married women need to strike a balance between their families and their businesses. They must also assist their husband and family in succeeding in this area.

 A woman entrepreneur cannot be successful if her husband does not support and approve of her business. As a result, a woman’s ability to enter the business world is positively influenced by her husband’s educational background and family history.

7. Male-dominated Society

The Indian constitution discusses the differences in quality between men and women. However, in actuality, women are viewed as a weaker demographic by society as a whole. Women and men are not treated equally. Consequently, it creates a barrier for women to enter the professional world.

8. Lack of Entrepreneurial Aptitude

The research indicates that just 7% of women are small-scale business entrepreneurs. Many women enrol in entrepreneurship development programs without being interested in starting their businesses.

9. Inefficient Arrangements for Marketing and Sale

Their items sell for more money because female entrepreneurs rely on intermediaries to market their products, resulting in a significant profit margin. Even if intermediaries take advantage of female entrepreneurs, getting rid of them is challenging since it requires much rushing around.

Additionally, it is difficult for female entrepreneurs to enter the market and become well-known for their goods. The business owner needs to be able to sell his goods and services for his enterprise to be prosperous. Both market and financial access are necessary to achieve this goal. The majority of female business owners still struggle with product promotion. Thus, it ranks among the primary issues facing female entrepreneurs.

The emergence of women entrepreneurs in India has been hampered by several issues, including poor infrastructure, a lack of electricity and technical know-how, a lack of training opportunities, financing availability, and other social and economic impediments.

Impact of Women-led MSMEs on the Economy

The Indian economy is changing dramatically as a result of the emergence of women-led MSMEs:

·  Job Creation

MSMEs run by women are opening up job prospects, particularly for other women. It increases household incomes while lessening the workforce gap between men and women.

· Growth of the Economy

The rise in women-led firms facilitates the expansion of the MSME sector, a significant contributor to India’s GDP. In addition, female entrepreneurs spearhead innovation in several sectors, including manufacturing, technology, retail, and services.

· Empowerment and Social Change

Gender equality and community empowerment are increasing due to female entrepreneurs shattering preconceptions and breaking down obstacles. Another benefit of women-led MSMEs’ success is inspiring other women to follow their entrepreneurial dreams and achieve financial independence.

· Inclusive Development

Women-led MSMEs promote more equitable and sustainable development by allowing women to engage in the economy actively. They are a significant factor in the economic expansion of neglected areas, such as rural and semi-urban areas.

Conclusion

The future appears bright for women-led MSMEs. By resolving current issues and exploiting new prospects, these companies can become potent catalysts for societal and economic advancement. With their continued expansion, women-led MSMEs have the power to propel social change in addition to financial success, opening the door to a more just and prosperous future. India can pave the way for future prosperity and innovation by empowering and supporting these trailblazers in the years to come.

Empower your entrepreneurial journey by visiting our website www.enterslice.com and get MSME Registration in India to grow your women-led MSME Today.

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