Women entrepreneurs still battling systemic challenges
Tasnuba Akhter Rifa :
Despite the increasing participation of women in the economy, women entrepreneurs in Bangladesh face substantial systemic barriers that hinder the growth and potential of their business ventures.
Talking to The New Nation, Nasreen Fatema Awal, the founding president of the Women Entrepreneurs Association of Bangladesh (WEAB) described the contemporary potentials and challenges of women’s entrepreneurships in Bangladesh.
The eminent woman business leader said, these challenges are rooted in both structural issues, such as limited access to credit, and social factors, including entrenched gender norms.
Specifically, in the cottage, micro, small, and medium enterprise (CMSME) sector, businesses led by women often face difficulties in securing financing due to insufficient collateral and a prevailing perception of heightened risk. Addressing these obstacles is critical for enhancing the contributions of women entrepreneurs and advancing economic development in the region.
However, in the proposed budget for fiscal year 2025-26, a special fund of Tk 125 crore has been allocated for women entrepreneurs.
Nasreen Fatema Awal said, “Women entrepreneurs are facing challenges at every stage, from business funding to establishing their outlets.”
During the discussion on the challenges encountered by women entrepreneurs in their professional journeys, she said, “The law and order situation is in poor condition. The government needs to pay close attention to the law and order sector. No matter what actions we take, they will not be effective until the government improves the law and order situation. Otherwise, women entrepreneurs will struggle to overcome the obstacles they face.”
“The training sessions for women entrepreneurs are currently facing challenges in effectiveness due to insufficient funding. Furthermore, there is a need to extend the duration of these training programs. It is my belief that enhancing the structure and content of the training sessions is crucial for empowering these entrepreneurs to develop their skills and achieve greater success” she added.
Even though the Bangladesh Bank (BB) has directed all banks and financial institutions to allocate 20 per cent of their green financing to women entrepreneurs and 25 per cent to cottage, micro, small, and medium enterprises (CMSMEs) still the banking sectors are not following the directions.
“I believe that if banks allocate 2 per cent of their funding specifically for women entrepreneurs, it could lead to significant positive outcomes,” the founding president stated.
Naseen further added that “While some entrepreneurs are achieving success in their business endeavours, others are encountering difficulties. It is essential to identify and address the needs of those facing challenges. In this context, the SME Foundation should provide targeted support to assist these entrepreneurs in overcoming obstacles and enhancing their business performance.”
The SME Foundation is continuously working to create new women entrepreneurs and integrate the existing ones into the mainstream development scene by providing comprehensive business support. The central bank emphasised that the women entrepreneurship sector play a crucial role in Bangladesh’s inclusive development and sustainable industrialisation.
However, despite these efforts, the expected level of financing women entrepreneurship sectors has not yet been achieved, the expert stated.
SME women entrepreneurs are facing different barriers, including inadequate credit facilities compared to their demand.
However, the MasterCard Index of Women Entrepreneurs (MIWE) published on April 11, 2023, said 31.6 per cent of entrepreneurs in Bangladesh are women. Working in a hostile environment, women in the country are developing themselves as entrepreneurs.
The National Industrial Policy 2016 states that at least 15 per cent of loans in the SME sector must be disbursed among women entrepreneurs.
Women’s contributions to the economy frequently remain unrecognised, as many operate unregistered businesses that lack the necessary licenses and tax documentation. This circumstance significantly impedes their ability to access financing options, including credit and various financial services.
Furthermore, factors such as limited mobility, restricted access to information, and inadequate integration into mainstream supply chains disproportionately disadvantage women entrepreneurs in comparison to their male counterparts.
“Business initiatives require a significant commitment of time, making it essential to conduct follow-up discussions with women entrepreneurs to evaluate their current business conditions. These interactions can provide critical insights into their challenges and opportunities, enabling more effective support and collaboration,” she concluded.