The Financial Express

New women entrepreneurs have less access to banking

Parental, social support underscored

| Updated: October 20, 2019 12:21:26

Picture used for representational purpose. Photo courtesy: IDLC Finance Ltd Picture used for representational purpose. Photo courtesy: IDLC Finance Ltd

New women entrepreneurs face difficulties to start up their ventures for lack of easy access to bank loans, according to a study.

It showed that the majority of 37.66 per cent respondents faced problem in getting formal credit. The main reason behind this is the lack of trust on women by banks and financial institutions both in private and public sector.

The research 'Women Entrepreneurs in SMEs: Bangladesh Perspective 2017' was unveiled on Thursday at the city's CIRDAP auditorium. It was conducted by Bangladesh Institute of Development Studies (BIDS) with the assistance of Small and Medium Enterprise (SME) Foundation.

The findings showed that the proportion of women facing the problem of insufficient capital is found to be the highest 41.57 per cent in Sylhet followed by Barishal 41.41 per cent, Dhaka 38.55 per cent, Chattogram 38.2per cent and Khulna 30.29 per cent.

The study carried 1510 respondents from all divisions. Of the total surveyed women, only 2.0 per cent are engaged in export-oriented business, the study said.

Due to lack of proper skills and opportunities, maximum number of the SME women cannot enter the international market.

The SME Foundation conducted a research on women entrepreneurs in 2009. The current study also focused on the similar issues. During the period 2009-2017, it had observed several changes including the policy related to SMEs.

The study also found that unmarried women get fewer opportunities to make entrepreneurship than that of married women for lack of capital. Usually parents don't want to provide money to daughters to start up business.

Women in Bangladesh usually do not get family or social support to become entrepreneurs as business is usually considered to be suitable for men. Therefore, young women prefer to take salaried jobs, according to the study.

Moreover, women, especially young unmarried ones, face the problem to get start -up capital from parental family, which is a common source of capital for young male entrepreneurs, the study said.

The research showed that about 98 per cent of the women entrepreneurs of Bangladesh are married. Of them 10.8 per cent are either separated or divorced or widowed.

Only two per cent women entrepreneurs are noted to be unmarried, it said.

About 65 per cent of the women entrepreneurs have come from business -oriented family environment, either from parents' side or from husband's sides.

About one third or 32.5 per cent of the women entrepreneurs came from business-oriented families; even 3.0 per cent are involved in the same business of their fathers.

Again husbands of more than half of the women entrepreneurs are in business profession and among them 10.3 per cent are in the same type of business.

Dr Nazneen Ahmed, senior research fellow of BIDS said new women entrepreneurs face obstacles to start up their business due to lack of loan facilities.

So steps should be taken to make the process of availing loan facilities easy by the newcomers, she said.

As unmarried women generally do not get capital from their parental homes, so they cannot establish themselves as entrepreneurs, she mentioned.

Besides, very often women also cannot expand their business because of family barriers as they think their family members will be deprived of their due services.

The authorities should find a way out to address the issues for further development of women entrepreneurship, she added.

The BIDS researcher also laid emphasis on conducting a separate study on unsuccessful entrepreneurs to discover the reasons behind their failure and make appropriate policy in this regard.

Among other problems, 18.39 per cent women reported limited knowledge about market, 14.77 per cent mentioned lack of confidence, 10.11 per cent lack of management skills, 6.81 per cent reported

lack of skilled workers.

It also showed that 75.5 per cent of the women entrepreneurs belong to the age cohort of 31 to 50 years. Besides, the average age of surveyed women entrepreneurs is 40 years.

Some 26 per cent are well educated having graduate degrees, while 24 per cent have education below secondary school level.

The educational status varies across sectors, for example, women entrepreneurs involved in software development, leather, pharmaceuticals, and education and health sectors have relatively higher level of education compared to average education level in other sectors.

A large portion of women entrepreneurs involved in agro-based business or clothing production have education level up to SSC.

Industries Minister Nurul Majid Mahmud Humayun was the chief guest at the programme while K M Habib Ullah, chairman of SME Foundation and entrepreneurs, among others, were present at the programme.



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