India's digital revolution has created 622 million internet users over the past two decades, with those numbers expected to grow 45 per cent by 2025. Businesses are rapidly going digital, and innovation has produced the likes of Aadhaar, India Stack, and UPI, bolstering the country's reputation as an inclusive digital innovator.
But not all Indian business owners are keeping pace. While roughly two-thirds of Indian small businesses intend to digitalise-potentially add up to $216 billion to the country's GDP by 2024-they face unique hurdles in turning those intentions into reality, and women entrepreneurs in particular face constraints.
Although small businesses owned or led by women consistently outperform peers, they are at risk of being left behind without tools and training tailored for their circumstances. And that means we all lose out.
There's a strong argument to be made for targeting women entrepreneurs with tailored support. Women-owned startups globally generated 10 per cent more revenue over a five-year period than their male counterparts.
Research has shown that women spread their earnings across the family and community, creating a virtuous cycle of growth. If supported, women-owned businesses could add 150-170 million jobs to India's economy by 2030.
There's an equally strong case to be made for employing digital technologies to help women leapfrog traditional obstacles, such as limited access to financial services, entrepreneurial networks, and skill-building opportunities.
However, to take full advantage of the opportunities, products and services must be designed and tailored to meet women where they are.
For example, women are often time-crunched, balancing family demands with business operations. Many don't have the time to acquire the necessary skills to grow and diversify their business.
However, social media and messaging platforms can now help deliver tailored, bite-sized information to enable women entrepreneurs to build skills whenever it suits their schedule.
Flexible training and time-saving tools are important, but they must also go hand and hand with business financing.
Two-thirds of women entrepreneurs identify access to capital as their top challenge. In India, an estimated 70 per cent of women's financing demand is unmet. This translates to a financing gap of $20.5 billion.
Helping women integrate digital technologies into their business operations can also unlock access to capital. Leveraging data insights and establishing digital sales footprints, for example, could establish a credit history based on performance, not collateral, ultimately changing how credit is delivered and creditworthiness is assessed.
Women entrepreneurs are 5-10 per cent more likely than men to have their credit application rejected. Yet women are more loyal financial customers and more likely to pay back loans on time.
Going forward, women will need more innovative programs and partnerships that address the broad range of constraints they face in a rapidly growing digital economy. By bringing together know-how and assets across sectors, we can collectively begin to scale solutions that work for women.
It's an immense undertaking, but one that is eminently possible and necessary for India to realise the full potential of women as engines of an inclusive digital revolution.
(The author is Founder & President of the Center for Inclusive Growth.)
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