New Delhi: NITI Aayog, together with TransUnion CIBIL and MicroSave Consulting, has released a report called “From Borrowers to Builders: Women’s Role in India’s Financial Growth Story”.
The report highlights a substantial increase in the participation of women in the financial system, with a 42% year-on-year growth in women borrowers.
As of December 2024, 27 million women actively tracked their credit scores, reflecting increased financial awareness and engagement. The report highlights the significance of access to finance in empowering women entrepreneurs and promoting inclusive economic growth.
Women Driving Credit Growth
Women’s proportion in the self-monitoring credit base has increased from 17.89% in 2023 to 19.43% in 2024. Interestingly, non-metro areas experienced a faster growth rate of 48% as opposed to 30% in metro areas. Maharashtra, Tamil Nadu, Karnataka, Uttar Pradesh, and Telangana contributed to almost half of all self-monitoring women, with the southern region topping at 10.2 million. Also, Rajasthan, Uttar Pradesh, and Madhya Pradesh have had the highest compounded annual growth rates (CAGR) in active women borrowers for the past five years.
Empowering Women Entrepreneurs
Addressing the launch, B.V.R. Subrahmanyam highlighted that access to finance is a critical driver for women’s entrepreneurship. He urged financial institutions to develop inclusive products catering to the needs of women and invited stakeholders to join the Financing Women Collaborative (FWC) under the Women Entrepreneurship Platform (WEP).
Anna Roy, Principal Economic Adviser, NITI Aayog, emphasized that encouraging women entrepreneurship is critical to driving workforce participation and catapulting economic growth. According to her, enabling businesses owned by women could create jobs opportunities for 150-170 million Indians.
Challenges and Opportunities
The report points to a rise in women’s proportion of business loan origination by 14% since 2019 as they make up 35% of business borrowers as of December 2024. Gold loans from women have also risen by 6% since the same time. All this notwithstanding, impediments like credit aversion, adverse banking experience, collateral-related issues, and unpreparedness for credit are still hurdles to complete financial inclusion.
