A recent report highlights the challenges faced by women entrepreneurs in Tier II and III cities, revealing that a significant number of them still struggle to access credit despite various government schemes. The report, based on a survey of over 1,300 women business owners, emphasizes the need for customized financial products, gender-sensitive lending practices, and alternative credit options. It also calls for urgent policy changes to address the barriers of collateral requirements and low financial literacy, while promoting digital and business management skills to empower women entrepreneurs in non-metro areas.
Challenges Faced by Women Entrepreneurs in India's Smaller Cities
In India’s Tier II, III, and beyond, women entrepreneurs are emerging as key drivers of economic development, breaking through traditional barriers and defying social expectations. Yet, despite their determination and ambition, many continue to face systemic challenges that hinder their growth. A recent study, the Bharat Women Aspiration Index (BWAI) 2025, sheds light on the specific difficulties encountered by women running small businesses in these regions.
The study, conducted by business management platform Tide, surveyed over 1,300 women business owners between the ages of 18 and 55 across non-metro cities. The results paint a picture of a group of highly motivated individuals whose business potential remains restricted by issues related to financial access, digital tools, and institutional biases.
Access to Credit: The Unmet Need for Customised Financial Products
One of the most striking revelations in the BWAI 2025 report is that one-third of women entrepreneurs still face significant challenges in accessing credit. Despite a range of government schemes designed to support small businesses, many women report that the financial products available to them do not meet their unique needs. Strict collateral requirements, low financial literacy, and limited access to formal financial networks continue to perpetuate a cycle of exclusion.
In particular, women running micro and small enterprises often struggle with the traditional banking system’s rigid requirements. Collateral, which many women lack, remains a major barrier to securing loans, even though these entrepreneurs have promising business ideas and are digitally savvy. This financial exclusion is not only a personal setback but also a missed opportunity for India's broader economic growth.
The report suggests that there is a need for tailored financial products that address the specific needs of women entrepreneurs. These could include collateral-free microloans, gender-sensitive lending practices, and more flexible repayment terms. Such measures would provide women with the financial independence needed to grow their businesses and contribute to their communities.
The Gender Gap in Business Networks and Digital Skills
Apart from financial barriers, women entrepreneurs in smaller towns often face difficulties related to business networks and digital tools. The BWAI report reveals that 58% of women business owners wish to enhance their financial and business management skills, while 12% specifically want to develop their digital competencies. In regions where formal networks are often male-dominated, women are at a disadvantage when it comes to accessing mentorship, networking opportunities, and advanced business strategies.
Additionally, nearly 28% of women surveyed reported that they required a male family member to be involved when seeking funding. This dependency on male intermediaries is a significant hindrance to their entrepreneurial independence and further deepens the societal biases they face.
Breaking the Cycle: Addressing Societal Biases and Improving Support
The report calls for urgent action to address these issues and level the playing field for women entrepreneurs. Key recommendations include investing in digital literacy programs, raising awareness about available support programs, and improving networking and mentorship opportunities. At the same time, there needs to be a concerted effort to challenge societal biases that hinder women's full participation in the business world.
Tide’s CEO, Gurjodhpal Singh, emphasized the importance of supporting women who are not only running businesses but are also contributing to their communities' growth. He highlighted that these women are embodying the spirit of 'Nari Shakti' (women's power) as they break down social and institutional barriers, reshaping the narrative around women in business.
However, these challenges are not insurmountable. With targeted interventions and structural changes in the way women entrepreneurs are supported, India could see a significant boost to its entrepreneurial landscape, particularly in smaller towns.
The Udaan Chronicles: Tide’s Initiative for Women Entrepreneurs
Recognizing the urgent need for support, Tide has launched a new multi-city advocacy roadshow, "The Udaan Chronicles." This initiative is designed to address grassroots challenges faced by women entrepreneurs and provide them with the tools, networks, and mentorship they need to succeed. Through expert-led mentoring sessions and peer networking opportunities, the roadshow aims to unlock the full potential of women entrepreneurs across India.
The program’s focus is on fostering meaningful change by addressing the structural challenges women face in accessing formal financial services and business networks. In addition to creating a ripple effect of visibility and empowerment, Tide aims to ignite a movement of "Naari Shakti" across India's entrepreneurial ecosystem, encouraging more women to pursue their business goals with confidence and determination.
Conclusion: Empowering Women for Economic Growth
The findings from the BWAI 2025 report highlight the significant challenges faced by women entrepreneurs in Tier II and III cities, but they also point to substantial opportunities for growth. By introducing customized financial products, addressing digital literacy gaps, and dismantling societal biases, India can tap into the untapped potential of women-led businesses.
Tide’s efforts, including the Udaan Chronicles initiative, show a path forward—one where women entrepreneurs are supported by stronger networks, more accessible financial tools, and a more inclusive business environment. As India strives to become a "Viksit Bharat" (developed India), empowering women entrepreneurs will be essential to building a sustainable and inclusive economic future.
In the coming years, the government, financial institutions, and private platforms like Tide must collaborate to break down the barriers that continue to hold back women in business, ultimately unleashing the full potential of India’s entrepreneurial landscape.
Comments