WOMEN ENTREPRENEURSHIP – Unit 4

Unit-4: WOMEN ENTREPRENEURSHIP 5 Hours

Definition of Women Entrepreneurs, Factors influencing Women Entrepreneurs, Problems of Women Entrepreneurs and Remedial Measures, Development of Women Entrepreneurs and Women Entrepreneurship, Association Promoting women entrepreneurs, Stand up India schemes for women-Central and State level.

Definition of Women Entrepreneurs:

A women entrepreneur is one who is innovative, confident, financially independent women, proficient in achieving self-economic independence, creates employment opportunities for the people, by promoting, setting up, and operating an enterprise, combining factors of production, undertake risks while keeping pace with personal and social life.

Factors influencing Women Entrepreneurs:[1]

Factor # (I) Motivational Needs:

The following are the motivational needs for which modern women are motivated to become entrepreneurs:

1) Economic Necessity:

In business, the entry of women is relatively a new phenomenon. Because of the break-up of the joint family system and the need for additional income for maintaining the living standards in the face of inflation or rising prices, women have started entering the most competitive world of business. Thus, because of the economic necessity, women have begun entering business field for earning some income and increasing their family income in modern days of inflation.

2) Desire for High Achievement:

Another motive force compelling women to enter business world is their strong desire for high achievement in their life. In modern days, though women are educated, they are not able to find jobs in the market place or they may not be able to go out of their homes for working somewhere else because of family problems.

Therefore, a woman is tempted strongly by a desire to achieve something high and valuable and prove herself as an asset and not a liability to the family. This is the strongest motivating force for a woman to become an entrepreneur.

3) Independence:

Another strong motive force compelling a woman to become an entrepreneur is to lead an independent life with self-confidence and self-respect. The ownership and control of a successful business provides a woman entrepreneur a prestigious status, personal reputation and a sense of independence in the society.

4) Government Encouragement:

The Government and non-government bodies have started giving increasing attention and encouragement to women’s economic conditions through self- employment and business ventures.

They have formulated various policies and programmes and introduced various incentive schemes to promote women entrepreneurs in the country. Such encouragement and incentive schemes have induced women to undertake business mentors.

5) Education:

Women have been taking up various kinds of technical, vocational, industrial, commercial and specialised education so as to qualify themselves to be self-employed in some kind of trade, occupation, vocation or business. Facilities are also being provided to women in areas where they can grow and blossom as persons in their own right. Women have proved in modern days that they are no less than men in efficiency, hard work or intelligence or even they can surpass men in several fields.

6) Model Role:

Women, like men, are also desirous of contributing their part to the economic development of their country. Similarly, our women in India would like to play a key role model. They have already entered other fields like politics, education, social field, administration, etc. Now they have started entering the business field where they can also show their importance as in other fields.

7) Family Occupation:

Family occupation is an important factor motivating a woman member to participate in the family business, along with her husband and other members of the family. There is a great need for women to undertake economic activity or business of the family and support their families in family occupation or family business so as to reduce the expenses of the family business and increase its income.

8) Employment Generation:

Another influencing factor that motivates women to become entrepreneurs is the creation of employment opportunities. Women entrepreneurs generally take up labour intensive small scale and village industries or handicrafts and they have high potential in employment generation. Therefore, they serve as a solution to the widespread problem of women unemployment to some extent.

9) Self Identity and Social Status:

Women desire to enjoy some social status and recognition in the society. Women entering business can achieve such a position of self-identity and recognition of social status because they come in contact with high level officers, ministers, authorities, and others holding high positions.

10) Growing Awareness:

With the spread of education and the growing awareness among women, the women entrepreneurs have been increasing, not only in the kitchen extension activities i.e. the 3 Ps viz. pickles, powder (masala) and papad or the traditional cottage industries, such as toy-making, basket-making etc. as they require less technical know-how, but they are entering also into engineering, electronics and many other industries which require high level technical skill. Thus, women entrepreneurs are found in such technical industries as T.V. capacitor, electronic ancillaries, and small foundries.

Thus, in modern days, women do not want to stay within the four walls of a house but they want to become, like their male, counterparts, achievement-oriented, career-minded and economically independent so that they would be able to provide costly high level medical and technical education to their children and, lead a high standard of living in their life.

Problems of Women Entrepreneurs and Remedial Measures:

The greatest problem faced by women entrepreneurs is that they are women. We are living in a male dominated society. They have to face several economic and social problems. Usually, they will not get any support or co-operation from various financial institutions, male entrepreneurs or even from their families.

They have to face resistance not only from men but also from elderly women who are ingrained with this attitude of inequality.

Women entrepreneurs have to face two types of problems viz., general problems of entrepreneurs and problems specific to women entrepreneurs.

The following are the important problems faced by women entrepreneurs:

1. Financial Constraints:

Finance is the life blood of every business. Both long term and short term funds are required for business. For obtaining loans and advances from financial institutions, they have to provide collateral securities. But, usually women do not have property in their names and this hinders them from obtaining external sources of funds.

The banks also consider women as less credit worthy and discourage women borrowers on the belief that they can at any time leave their business and become housewives again. Under these circumstances, women entrepreneurs are bound to rely on their savings and loans from friends and relatives. The quantity of such funds are often negligible leading to the failure of women enterprises.

2. Over Dependence on Intermediaries:

Women entrepreneurs have to depend largely on intermediaries for the distribution of their products. These intermediaries take a major portion of their profits. It may be possible for the women entrepreneurs to eliminate the middlemen, but it requires additional investment of capital and a lot of travel. Women entrepreneurs find it difficult to capture market and popularise their products.

3. Stiff Competition:

Women entrepreneurs have to face stiff competition for the products from the organised industries and male entrepreneurs. They do not have organisational set up to spend a lot of money for canvassing and advertisement. The society has a feeling that the products manufactured by women are inferior in quality on account of the fact that they are manufactured by women themselves. These factors will lead to the liquidation of women enterprises.

4. Scarcity of Raw Materials:

Scarcity of raw materials is yet another important problem faced by the women entrepreneurs. The price of raw materials is very high and women entrepreneurs usually get the raw materials at minimum discount. The failure of many women co-operatives engaged in basket making in 1971 is an example of how the scarcity of raw materials affects entrepreneurship.

5. High Cost of Production:

Another problem faced by women entrepreneurs is the high cost of production. The government grants and subsidies help them tide over this difficulty, but these grants and subsidies are available only at the initial stages of its setting up. For expansion and diversification activities these assistances will be negligible.

6. Limited Mobility:

Unlike men, women mobility in India is highly limited due to various reasons. Physically they are not fit enough to travel a lot. A woman running an enterprise independently and alone is often looked upon with suspicion. The humiliating attitude of officials towards women compels them to give up the idea of starting an enterprise.

7. Family Ties:

The family responsibilities also hinder the development of women entrepreneurship. In India, it is mainly a woman’s duty to look after the children and other members of the family. Man plays a secondary role in these matters. In the case of married women, they have to make a fine balance between their business and family.

Their success greatly depends on the support given by the family. Occupational backgrounds of families and educational level of husbands have a direct bearing on the development of women entrepreneurship.

8. Lack of Education:

In India around 60% of women are still illiterate. Illiteracy is the root cause of socio-economic problems. Due to lack of education, women are ignorant of business technology and market. It also reduces the achievement motivation among women. Thus, lack of education creates problems for women in the setting up and running of business enterprises.

9. Social Attitudes:

This is one of the most important stumbling block in the path of women entrepreneurship. The constitution provides equality for both men and women, but there is widespread discrimination against women. In a male dominated society, women are not treated as equals to men. Women have the potential but they lack adequate training.

There is a common belief that skill imparted to a girl is lost when she gets married. Therefore, girls continue to be helpers in agriculture and handicrafts and the rigid social attitudes prevent them from becoming successful and independent entrepreneurs.

10. Male Dominated Society:

Male chauvinism is still the order of the day in India. The constitution of India speaks of equality between genders. But, in practice women are treated as ‘abalas’. Women suffer from male reservations about their roles, abilities and capacities. In short, women are not treated as equal to men. This is the main barrier to women’s entry into business.

11. Low Need for Achievement:

The pre-requisites for success in entrepreneurship are the need for achievement, independence and autonomy. But in India the common Indian woman is happy to bask in the glory of their parents, husband, children etc. They have preconceived notions about their role in life. This inhibits them from achievements and independence.

In addition to the above difficulties, lack of infrastructural facilities, shortage of power, difficulty in obtaining licenses from various control boards and a number of other socio-economic problems stand as hurdles to the women entrepreneurs.

Solutions to the Problems of Women Entrepreneurs:

From the above discussion, it is clear that women entrepreneurs have to face a number of problems.

In order to overcome these difficulties, the following remedial measures can be adopted:

1. Separate Finance Divisions:

Separate finance divisions can be opened by various financial institutions and banks for providing easy and ready finance to the women entrepreneurs. Through these divisions they can provide finance at concessional rates to women entrepreneurs. In order to avoid the humiliating attitude of the offices, these divisions may be under the control and management of women officers.

2. Supply of Raw Materials:

Women entrepreneurs must be given priority over other entrepreneurs in the supply of controlled and scarce raw materials. If possible, the government of local authorities must give tax exemptions to the supply of raw materials to the women entrepreneurs. The Government must make adequate steps to supply the raw materials at the minimum price.

3. Co-Operative Women’s Marketing Societies:

Marketing of products is one of the major problems faced by women entrepreneurs. In order to overcome this difficulty, they can start co-operative societies. These societies can collect the products manufactured by the women entrepreneurs and sell them at competitive prices by eliminating middle men. A chain of societies can be started all over the state/country for wider distribution of products.

4. Education and Social Change:

It is necessary to make people aware of entrepreneurship development, various products, their marketing facilities, competition etc. The negative attitude of the society towards women should be changed.

5. Training:

The modern concept of entrepreneurship is that ‘entrepreneurs are not born but made.’ By giving proper training we can develop the inborn talents of an individual and make him an entrepreneur. For this, the governmental agencies and financial institutions can set up separate divisions for giving training to women entrepreneurs. The training scheme of the syllabus should be so designed that women can take full advantage of the training facilities.

6. Family Background:

There should be a sound family background for the development of women entrepreneurs. Elders, particularly mothers, should be aware of the potential of girls and their role in the society. Parents in the initial stage, and husbands in the later stage should support women for doing the entrepreneurial activities successfully.

7. Support from the Society:

Necessary steps should be taken to make the society aware of the role of women in its economic and social development. There must be a change in the negative attitude of the society towards women entrepreneurs. The society shall provide encouraging support to women who take up entrepreneurial activities.

8. Support from the Government:

Both Central and State Governments should give priority to women entrepreneurs for starting new ventures. The governments must give infrastructural facilities, raw materials, tax exemptions and concessions to them. The government can also give special grants and subsidies to the women entrepreneurs.

Women have to play a vital role in the economic development. They have the potential and will to establish and manage business enterprises. For this, they need encouragement and support from the members of their family, the government and the society at large.

Development of Women Entrepreneurs and Women Entrepreneurship:[2]

Women entrepreneurs in India have been playing a very important role in business or industry since their entry into this section. The Government of India has been giving increasing attention to them to improve their performance and play a significant role in the economic development of the country through self-employment and industrial ventures. Several policies and programmes have been formulated by the Government to develop women entrepreneurs in India.

Following are the few suggestions for the development of women entrepreneurs:

1. Women should be considered as a specific target group for all developments.

2. Government should provide better educational facilities and schemes.

3. More Governmental schemes should be launched to motivate women entrepreneurs to engage in small scale and large-scale business ventures.

4. Adequate training programme has to be conducted for the women entrepreneur.

5. Continuous monitoring and improvement of training programmes is essential for grooming women entrepreneurs.

6. Making provision of marketing and sales assistance from government part.

7. To encourage more passive women entrepreneurs the Women training programme should be organised that taught to recognize psychological needs and express them.

8. The financial institutions should provide more working capital assistance both for small scale venture and large scale ventures.

Association Promoting women entrepreneurs:

Self-Help Groups (SHGs)

This is an association of small group of self-employed rural or urban women entrepreneurs who join together to take care of group welfare. The group with the help of financial institutions and other NGOs get their needs satisfied. This is voluntary association. Each member contributes little amount to cover seed money. Rest will be taken care off by FIs or NG0s. Governments also provide funds through FIs. In Karnataka “Stree Shakti” scheme of Government of Karnataka is providing funds for women entrepreneurs through FIs for the last four years.

Federation of Indian Women Entrepreneurs (FIWE)

FIWE is the outcome of resolution passed in 4th International Conference Women Entrepreneurs held at Hyderabad. This was founded in 1993. It mainly interacts with various women associations of the country through a network to facilitate the members in diversified activities.

Activities of FIWE are as follows:

To provide network facilities to women entrepreneurs in the country and abroad to develop their business.
To provide facilities to member associations in the areas of marketing, quality control, export management, standardization etc. The Federation also provides training facilities in these areas.
Facilitates the member associations to participate in national and international conference, fairs, exhibitions, to provide greater exposure to women entrepreneurs in local, regional, national and global business environment and provide an access to various business opportunities available.
Provides facilities to expand the business of members and of member associations. It may be new project or extension of the existing business. Every type requires help for such activity is extended.
Women entrepreneurs can easily access the latest technologies relating to their business through FIWE. Easy availability of know how itself is a boon to WEs.
Other facilities such as providing new business opportunities facilitating financial needs of members, better management of business enterprises etc., are also provided.

WE Mission-Kerala[3]

As identified by KSIDC, encouraging female entrepreneurs is one of the key areas of growth for Kerala economy. Hence KSIDC has initiated the WE- Mission Kerala, which helps the women-led endeavors through comprehensive support measures. To build more women entrepreneurship in Kerala, this mission helps to identify, promote and support women entrepreneurs.

KSWDC

The Kerala State Women’s Development Corporation encourages women to be ambitious and confident about their success and dreams. It provides them with the required support system that makes their needs come into fulfilment. As economic and financial dependence is a hurdle in the success of entrepreneurship, the organization has many schemes and policy to nourish the growing demands of the women of the state.

FIWE

Federation of Indian Women Entrepreneurs is a platform for women to help them with, Industry research & expertise, Skill development & training. FIWE brings women on a Common Forum and ensures that their opinions, ideas and visions are taken up with policy makers and various other agencies respectively for the development of Women entrepreneurship in India.

SIDBI

SIDBI stands for Small Industries Development Bank of India. It is a national level institution which extends help for growth of small-scale industries by women. This organization has introduced two special schemes these are:

MAHILA UDYAM NIDHI

MAHILA VIKASH NIDHI

CWEI

The consortium of women entrepreneurs of India is a voluntary organization consisting of Non-Governmental Organization (NGO). It was formed with the basic objective of providing technological up gradation facilities for female entrepreneurs.

Stand up India schemes for women-Central and State level:[4]

Recognizing the challenges faced by Aspiring SC, ST and women entrepreneurs, Stand up India Scheme was launched on 5th April 2016 to promote entrepreneurship at grassroot level focusing on economic empowerment and job creation.

As India is growing rapidly, hopes, aspirations and expectations of a large group of potential entrepreneurs, particularly women and Scheduled Castes (SCs), Scheduled Tribes (STs), are rising. They want to set up an enterprise of their own to allow themselves to thrive and grow. Such entrepreneurs are spread across country and are bubbling with ideas on what they can do for themselves and their families. The scheme envisages to facilitate the dreams of aspiring SC, ST and women entrepreneurs to reality by supporting their energy and enthusiasm and removing many hurdles from their path.

The objective of Stand-Up India is to promote entrepreneurship amongst women, Scheduled Castes (SC) & Scheduled Tribes (ST) categories, to help them in starting a greenfield enterprise in manufacturing, services or the trading sector and activities allied to agriculture.

The purpose of Stand-Up India is to:

promote entrepreneurship amongst women, SC & ST category;
provide loans for greenfield enterprises in manufacturing, services or the trading sector and activities allied to agriculture;
facilitate bank loans between Rs.10 lakh and Rs.1 crore to at least one Scheduled Caste/ Scheduled Tribe borrower and at least one-woman borrower per bank branch of Scheduled Commercial Banks.

Why Stand-Up India?

The Stand-Up India scheme is based on recognition of the challenges faced by SC, ST and women entrepreneurs in setting up enterprises, obtaining loans and other support needed from time to time for succeeding in business. The scheme therefore endeavors to create an eco-system which facilitates and continues to provide a supportive environment for doing business. The scheme seeks to give access to loans from bank branches to borrowers to help them set up their own enterprise. The scheme, which covers all branches of Scheduled Commercial Banks, will be accessed in three potential ways:

Directly at the branch or,
Through Stand-Up India Portal (www.standupmitra.in) or,
Through the Lead District Manager (LDM).

Who all are eligible for a loan?

SC/ST and/or women entrepreneurs, above 18 years of age;
Loans under the scheme are available for only green field projects. Green field signifies; in this context, the first-time venture of the beneficiary in manufacturing, services or the trading sector and activities allied to agriculture;
In case of non-individual enterprises, 51% of the shareholding and controlling stake should be held by either SC/ST and/or Women Entrepreneur;
Borrowers should not be in default to any bank/financial institution;
The Scheme envisages ‘upto 15%’ margin money which can be provided in convergence with eligible Central/State schemes. While such schemes can be drawn upon for availing admissible subsidies or for meeting margin money requirements, in all cases, the borrower shall be required to bring in minimum of 10 % of the project cost as own contribution.

Changes to Stand Up India Scheme

Pursuant to an announcement by the Union Finance Minister in the Budget speech FY 2021-22, the following changes have been made in the Stand Up India Scheme:-

The extent of margin money to be brought by the borrower has been reduced from ‘upto 25%’ to ‘upto 15%’ of the project cost. However, the borrower will continue to contribute at least 10% of the project cost as own contribution;
Loans for enterprises in ‘Activities allied to agriculture’ e.g. pisciculture, beekeeping, poultry, livestock, rearing, grading, sorting, aggregation agro industries, dairy, fishery, agriclinic and agribusiness centers, food & agro-processing, etc. (excluding crop loans, land improvement such as canals, irrigation, wells) and services supporting these, shall be eligible for coverage under the Scheme.

Achievements of this Scheme as on 21.03.2022

Rs. 30160 crore has been sanctioned under Stand Up India Scheme to 133,995 accounts upto 21.03.2022 since inception of the Scheme.
Total number of SC/ST and Woman borrowers benefited under Stand Up India scheme, as on 21.03.2022 are as below:

(Amt. in Rs. Crore)

SC	ST	Women	Total
No Of A/Cs	Sanctioned Amt.	No Of A/Cs	Sanctioned Amt.	No Of A/Cs	Sanctioned Amt.	No Of A/Cs	Sanctioned Amt.
19310	3976.84	6435	1373.71	108250	24809.89	133995	30160.45