Raising funds through equity and providing collateral for debt are the root cause of financing deficit that women entrepreneurs face, according to former SBI Chairperson Arundhati Bhattacharya.
Speaking here at the India Economic Summit, Bhattacharya who is now the Chairman of Board SWIFT India said the stereotype that women cannot handle money also needs to change for more women entrepreneurs to emerge in India.
“In entrepreneuship you need equity in business. For men it is far more easier to raise money, though women are far better in repaying debt,” she said.
Bhattacharya further said when raising finance, women are either a little afraid of the numbers to go ahead and confidently state what sort of growth they were looking in the business for which the funds were required.
Citing the examples of startups, she said “youngsters are saying we will achieve 300 per cent, 500 per cent growth. I don’t see a woman ever doing that and that is not something that gets you the money.”
She further said,”If you look at the financing gap, one reason is collateral, which is always a problem (for women), specially when you are trying to scale.”
Bhattacharya said, “I think both equity and collateral are things that really are the root of financing deficit that women (entrepreneurs) face.”
Highlighting the shortage of women entrepreneurs, Bhattacharya said there were only about 19 per cent women entrepreneurs in India and out of which in many of women are “figurative heads and it is actually men who are driving from behind”.
“Further, when we looked at the (women) entrepreneurs we found that quite a few of them actually have an issue in the area of finance,” Bhattacharya said.
These are basically on account of “stereotypes found across that women can’t handle money”, Bhattacharya said. PTI MSS KRH SR RKL