Brief Context
Recently NITI Aayog launched the report titled From Borrowers to Builders: Women’s Role in India’s Financial Growth Story.
Source Content
Syllabus: GS1/ Women Empowerment
Context
- Recently NITI Aayog launched the report titled “From Borrowers to Builders: Women’s Role in India’s Financial Growth Story.”
- The report sheds light on the role of women entrepreneurs in shaping India’s economic landscape.
Key Findings
- Steady Rise in Women Borrowers: Women seeking credit grew three times between 2019 and 2024, reflecting increased demand among female borrowers.
- Women Borrower Demographics: About 60% of women borrowers availing credit are from semi-urban or rural areas.
- Women under 30 years of age account for only 27% of retail credit uptake by women, compared to 40% for men.
- Credit Supply Trends: Women’s participation in credit origination has seen notable growth in recent years. Since 2019, the share of Women in Business Loans and Gold Loans has increased by 14% and 6% respectively.
- By 2024, 42% of loans availed by women were for personal finance, a slight increase from 39% in 2019.
- The majority of loans availed by women continue to be against gold – 36% of all loans availed by women in 2024 were gold loans vs. 19% of loans availed in 2019.
- Rise in Credit Monitoring and Awareness: As of December 2024, 27 million women borrowers in India have monitored their credit information report and score with CIBIL.
Significance
- Economic Growth: Women constitute nearly half of India’s population but contribute only 18% to the GDP.
- Encouraging women entrepreneurs can increase India’s GDP by 27%, as per IMF estimates.
- Employment Generation: MSMEs owned by women play a crucial role in job creation and skill development at local levels.
- Social Empowerment: It promotes gender equality by demonstrating women’s ability to lead and manage enterprises successfully.
Government Initiatives
- The National Rural Livelihood Mission has enabled 9 million women Self Help Groups (SHGs) to improve their livelihoods through access to formal banking.
- NITI Aayog’s Women Entrepreneurship Platform (WEP) brings together public and private sector partners to create a supportive ecosystem for women entrepreneurs.
- The PM SVANidhi Yojana supported 30.6 lakh women street vendors with 5,939.7 crore in working capital loans as of December 2024.
- Pradhan Mantri Mudra Yojana (PMMY): In FY 2023-24, loans totaling INR 2.22 lakh crore were disbursed to 4.24 crore women entrepreneurs.
Challenges faced by Women Business Borrowers
Conclusion
- NITI Aayog reinforced that encouraging women entrepreneurs can create employment opportunities for 150 to 170 million people while driving greater participation of women in the workforce.
- By ensuring easier access to credit, mentorship, and support systems, India can unlock the full potential of women-led enterprises.
Source: AIR