Women Entrepreneurs in Small and Medium Enterprises and their Access to Finance

Abstract

In developing countries most women are prisoners of their environment. They are placed in a situation, often not of their making, expected to adapt and fit into socially carved roles. But, paradoxically, because of education, exposure to the outside world, change in mindsets, have brought more and more women into entrepreneurship. Yet they are miniscule of the entrepreneurial population in India. In the 21st century women still face barriers regarding access to finance, access to networks, access to markets, access to technology which may be common to all entrepreneurs but women have to grapple with the additional burden of managing their homes with their businesses. As most women get their empowerment from fulfilling the social roles they are often not very interested in becoming entrepreneurs. Research indicates that in India it is often the need for survival, need to provide for their families or inability to find suitable employment drive women into entrepreneurship. The governments all over the world are looking at women entrepreneurship for boosting their economic growth as it is realized that it is a valuable resource having huge potential for nations. This study therefore focuses on women entrepreneurs in small and medium enterprises, who go beyond themselves and create jobs, add value and show promise of growth. The literature on women entrepreneurship in India and around the world recognizes lack of access to finance as the major deterring factor. Hence, this study focuses on women entrepreneurs in small and medium enterprises (SMEs) and their access to finance. The earlier research studies on women entrepreneurs in SMEs reiterates the significance of entrepreneurs characteristics, enterprises characteristics, institutions, policies and programs of the government, non-financial constraints faced by women in accessing bank finance, and not finding women entrepreneurs a profitable and productive segment. Hence, an attempt has been made with mixed methods approach to relate the above independent variables to the dependent variable access to bank finance. There are several myths undermining women entrepreneurs role in the development of the nation. Hence, their contribution to self, family, society and the economy was studied in-depth. Both probability and non-probability sampling techniques were used. The study was cross-sectional innature and was limited to the state of Karnataka as promotion and development of industries is a state subject under the constitution of India. The study results support the hypotheses that characteristics of the women entrepreneurs, the enterprise characteristics, policies and programs of the government, non-financial constraints influence access to bank finance.