Financial literacy a must to empower women entrepreneurs

Financial literacy is crucial for empowering women entrepreneurs, according to Farzana Khan, general manager of the SME Foundation.

"We must go beyond offering financial products and ensure that women have the skills and knowledge to navigate these services effectively. This will complement policy efforts and enable women to fully participate in the financial system," she said.

Khan made the comments at an event titled "Bridging the gap: regulation and practices for better credit access to women entrepreneurs", hosted by MicroSave Consulting (MSC) with support from the Bill and Melinda Gates Foundation at the Westin Dhaka yesterday.

The event marked the culmination of MSC's Women Business Diaries project.

"Despite efforts to support women entrepreneurs, we must look beyond concessional rates," said Nawshad Mustafa, director of the SME and special programmes department of Bangladesh Bank.

He emphasised that policies must address structural barriers, such as collateral requirements and complex documentation, to accelerate access to finance for women-led businesses.

Chowdhury Saima Ferdous, professor at the Department of International Business of the University of Dhaka, highlighted the nonavailability of suitable financial products for women.

"We need policies that address the unique challenges women face, such as limited mobility and social constraints. This will help make financial services more inclusive," she said.

Shafquat Hossain, head of retail banking at Mutual Trust Bank Limited, stressed the need to go beyond traditional approaches.

"We must develop products tailored to women entrepreneurs' needs, simplifying loan processes and offering flexible collateral requirements and advisory services," he said.

Making banking more accessible will help women-owned businesses thrive in a competitive market, Hossain said.

Sohail RK Hussain, managing director of Bank Asia, noted that having more women bankers and agents on the ground has significantly improved outreach to female customers.

"It's not just about offering financial products but creating a supportive environment that encourages women to engage with formal financial institutions," he explained.

Syed Mahbubur Rahman, managing director of Mutual Trust Bank, emphasised the importance of collaboration between banks, FinTechs, and development organisations in enhancing financial access for women.

"By pooling resources and expertise, we can create innovative solutions that meet the specific needs of women entrepreneurs and equip them to succeed," he said.

Syed Abdul Momen, head of SME at BRAC Bank, pointed to the success of gender-focused programmes like TARA in boosting women's financial inclusion.

"By offering flexible financing terms and support services, we not only provide loans but also build the confidence and capacity of women entrepreneurs to grow their businesses," he added.

The SME sector is considered to be the country's lifeline, accounting for about 25 percent of the gross domestic product.

According to the Economic Census 2013 of the Bangladesh Bureau of Statistics, the country had 78.8 lakh business establishments.

Of them, 87.52 percent were cottage, 1.33 percent micro, 10.99 percent small, 0.09 percent medium and 0.07 percent large enterprises.

According to a report by the Planning Division under the Ministry of Planning released in 2019, SMEs accounted for 69.9 percent of total manufacturing value-addition in Bangladesh.