What Women Entrepreneurs Need to Know About Financing Their Busi
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What Women Entrepreneurs Need to Know About Financing Business

  • Highlights

  • Challenges faced by women entrepreneurs

  • How women entrepreneurs can establish a successful business

  • Things to do when applying for a business loan

  • The importance of research when applying for a loan

Women entrepreneurs are carving out a name for themselves in the global business community. However, India ranked among the countries with the lowest percentage of women-owned businesses. This statistic comes from the Mastercard Index of Women Entrepreneurs, a survey that was conducted in 54 countries among which India ranked only at 49th place.

Additional Read: Business Ideas for Women and How to Arrange for Funds

The survey reaffirmed the plight of women entrepreneurs in India, pointing out that lack of technological knowledge, lack of education, cultural bias and stringent government regulations meant that women have a very tough time taking hold of entrepreneurial opportunities in the country. If women do manage to overcome these challenges, there is always the perennial problem of securing financing for the business.
Despite the increase in efforts made by the Indian government to promote women entrepreneurs through schemes giving financial aid, 8 out of 10 women entrepreneurs are still self-financing their business.

Additional Read: Great Sources of Financing for Women Business-Persons

1. Start Networking

Meeting the right people can instantly make things easy for you. Getting yourself and your business known in the community can prove to be a big advantage. To secure credit and grow the business, it is important to make an impression. Just like the chances of getting a job are better through a placement agency, chances of getting a loan is amplified through networking.

Joining local business-support groups and attending business events, gatherings, etc. goes a long way. An aspiring business person can get to know a lot of influential people in the business community through such events. Lenders often work with organisations, and people in these organisations, in touch with the business owner, can put in a good word for them, raising the chances of getting finance.

Additional Read: Reasons Why Business Loans Are Financially Beneficial

How To Get Small Business Finance From Bajaj Finserv

Financial Habits that will help you get a business loan

As a small business owner, you need to stay on top of your business’s finances, in order to ensure that your business keeps running smoothly and never runs out of working capital for its day-to-day operations. Additionally, you need to ensure that you are able to obtain external financing for your business when the time comes for your business to grow, or take on a large project. Here, we give you a few financial habits that every small business owner should have, that help you get a business loan easily when the time comes for you to apply for a loan.

2. Prepare Beforehand

A high credit score expedites your chances of getting business loans for women. You need to watch for those red flags, and monitor your credit score regularly. It is important to avoid loan defaults, negative consumer feedback, and theopening of several credit accounts.

Ensure that your profit and loss statement, tax returns and other important financial documents are up-to-date and organised. Taking out small loans through institutions which report to the

credit bureau helps in building up your credit score. Furthermore, getting a copy of the credit score can be helpful in tracking your creditworthiness.

Organising and maintaining all the important financial documents in the name of the company will help you immensely at the time when you will need a loan.


3. Do Due Research

Doing some background research before applying for a small business loan can make things easier for women entrepreneurs. It is no use applying for a loan to a lender that only funds high-end businesses and multinational companies. A quick research on the lender’s loan requirements can save women business owners a lot of time and energy.

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