Women's Role in India's Financial Growth Story: From Borrowers To Builders" report published

Important Points to Remember

Consistent Growth in Female Borrowers: Due to rising demand, the number of female borrowers increased by about three times between 2019 and 2024.

Demographics of Women Borrower: 60% of women borrowers are from semi-urban or rural areas.

Women under 30 make up only 27% of those who take out retail credit, while men make up 40%.

Regional Status: Southern states have larger shares of women borrowers as compared to Northern and Central States.

Rise in Awareness: 27 million women borrowers had examined their credit information and score with CIBIL.

Problems with Credit Aversion for Female Borrowers:

• Women are reluctant to take out formal loans due to social norms, concerns about the implications of default, and challenging application processes.
• Bad Banking Experience: Many banks are hostile and do not offer advising services that are appropriate for women's requirements.
• Limited Institutional Support: Women are viewed as higher-risk borrowers due to their lack of credit history and business experience.
• For instance, 79% of women-owned businesses are self-financed, while just 7% of MSME financing is given to women.
• Credit readiness is hampered by the absence of necessary documentation, guarantors, and collateral. For example, more than 22.2% of all women-owned firms are not credit-ready.

The suggestions

Increase the number of women who can obtain business loans by implementing measures for cheap lending, gathering data that breaks down sex, and increasing guarantee coverage. Create Gender-Intelligent Financial Products by creating customized solutions that take into account the requirements of women throughout their lives as well as societal conventions and systemic obstacles. Rethink Credit Risk Assessment: Prevent gender prejudice by utilizing AI and big data. Encourage digital transactions, recordkeeping, and business formalization to increase credit readiness