Women Entrepreneurs Face 30 Lakh Crore Credit Gap, Says Survey

By: Women Entrepreneurs Review Team | Wednesday, 8 July 2026

Achievement of India's target of achieving a developed economy hinges on the role of women entrepreneurs in creating businesses, employment, and economic development. Women around the country are creating small businesses in manufacturing, retail, agriculture and services and allied activities, and are innovating to solve local problems. Despite the availability of finance, markets, mobility and mentorship for women-led businesses is still constrained.

The empowerment of women entrepreneurs is not only a viable measure for attaining gender parity but it is also a good economic policy. By early 2026, over 3.39 crore women entrepreneurs had registered on the Udyam portal, representing almost 38 per cent of the total number of MSMEs registered in India. These enterprises are helping to create jobs, incomes and local economic growth.

The right kind of support system makes a difference to successful women entrepreneurs. During the training of the women professionals, Priyanka Chavan of Maharashtra grew a small salon to a beauty academy with an annual turnover of ₹60 lakh. Likewise, Andhra Pradesh's Balimidi Aruna developed a traditional sweets business, employing 15 women, by mentoring and providing support. Their trips bring to light the role of capital, business support and market opportunities in changing small businesses into sustainable businesses.

However, women entrepreneurs are still encountering significant financial challenges. The credit gap in India's MSME sector is estimated to be in the range of around ₹30 lakh crore with women entrepreneurs being the least served. Many women are unable to grow their businesses because they lack formal loans or documentation and ownership of the collateral.

Key Highlights:

• Women-led MSMEs fuel India's economic growth
• Credit and mentorship gaps continue to hinder women entrepreneurs
• Better finance and digital support can help women-led businesses scale

According to a survey of 450 women entrepreneurs in Delhi-NCR, Chennai and Pune, 85 percent of them had to face problems to get loans from public sector banks and 60 percent had issues in accessing financial services like loans, savings account, insurance and working capital. The results show that lacking entrepreneurial intent is not the problem, but having limited access to financial resources and institutional support.

Finance is not the only thing that can help businesses grow, experts stress. A mentor is also vital in supporting entrepreneurs to build their business planning, financial management, compliance, customer acquisition, and long-term growth strategies.

The Bharatiya Yuva Shakti Trust (BYST) was set up in 1992 to promote entrepreneurship with mentoring and collateral-free lending. It has counseled more than a million youths, supported in creating over 18 thousand businesses and arranged nearly ₹980 crore worth of collateral-free bank loans. It has also resulted in employment creation of approximately five lakh jobs and estimated creation of ₹10,000 crore of economic value. More than 35% of the entrepreneurs supported by BYST are women, a significant sign of women's involvement in enterprise development.

In addition to finance and mentoring, women entrepreneurs need to be better trained in digital literacy, financial management, branding and e-commerce adoption and market linkages. These gaps may be addressed by using public-private partnerships to facilitate skill development, technology uptake and access to new markets to support women-led businesses to scale up in a stable and sustainable way.

The positive impact of women entrepreneurship is not just limited to businesses. Successful women entrepreneurs make a positive contribution towards the higher income of the household, better educational opportunities for children and, stronger local economy. Women entrepreneurs also create jobs in the rural areas of India and curb migration to urban areas thereby promoting balanced regional development.

Efforts by the Government of India like Udyam Registration, Mudra loans, Startup India, Stand-Up India, PSB 59 Minutes Loan Portal, ONDC, India's Digital Public Infrastructure have enhanced access to formal business ecosystems. But experts think that the next step should be making credit more readily available, increasing flexibility in credit models, mentoring-based finance, and improved cooperation among banks, financial technology firms, development institutions and civil society organizations.

Empowering women entrepreneurs will be a crucial part of inclusive development in a developing country like India as it is in the process of moving towards a developed economy in the years to come. Women entrepreneurs can become a leading force in the country's economic development, enhance communities and generate employment with a combination of financing, mentorship, digital skills and market access.