Empowering Women Entrepreneurs — The Surprising Impact of Microfinancing

Starting a business is no easy feat, especially for women. The odds are often stacked against women entrepreneurs, from access to funding to the gender pay gap. However, the world is changing. Enter Microfinancing. This innovative approach to lending has been making waves in the entrepreneurial world, and for a good reason. According to a paper by Dr. Shuchi Loomba, 44% more women can quickly get loans to start their ventures.

In this blog, we’ll explore the impact microfinancing has on women entrepreneurs and how it’s helping to empower and elevate their businesses.

Microfinancing — A Brief Overview

What is Microfinancing?

It is a way of providing small loans to individuals or groups who cannot access traditional forms of credit. These loans are typically smaller and are given to low-income individuals, small business owners, and those living in developing countries.

How is Microfinancing different from traditional lending?

Traditional lending, like bank loans, usually only goes to people with good credit history and who meet specific requirements. The process can be complex and take a long time.

Microfinancing, on the other hand, is easier to get and available to more people. The loans are smaller and the process to apply is usually faster and less complicated.

Why do women-owned businesses need Microfinancing?

Women entrepreneurs often face barriers when it comes to funding and success.

First, there is the gender pay gap. Women are paid about 20% less than men for the same designation, which presents another hurdle.

Then, lenders can also discriminate against women making it harder for them to get much-needed loans.

Microfinancing can help by making loans and funding more accessible and less discriminatory. It can also provide education and training to help them succeed.