Women in online business lack access to finance: experts

Many women entrepreneurs who run online businesses face challenges in accessing finance as they operate from home and lack a physical setup, according to a paper presented during a discussion.

Additionally, entrepreneurs are often required to provide property as collateral when seeking loans to start a business, but many women do not have this asset, making it a significant obstacle for them, Siddikur Rahman, programme analyst for Women's Economic Empowerment at UN Women Bangladesh, said during a presentation.

Besides, two guarantors are required to take formal loans, another factor that poses a challenge for women, he also mentioned.

The discussion, styled "Inclusive and Gender Responsive Environment for Women-Owned Business", was held at The Daily Star Centre in Dhaka today. The event was organised by UN Women in partnership with Bangladesh Nari Progati Sangha and The Daily Star.

This discussion was a part of the Women's Empowerment for Inclusive Growth (WING) project, implemented jointly by UN Women, the United Nations Development Programme and the United Nations Capital Development Fund with funding from the Embassy of the Kingdom of the Netherlands.

The WING project, running from November 2020 to December 2024, aims to enhance the formal participation of women as employees and entrepreneurs, ensuring sustainable improvements in income and economic security at the local level.

Siddikur said there is a negative perception of women-owned businesses in our society. "It's not gender-friendly. In Bangladesh, many people still think there is no diversity in products made by women."

Rahman also mentioned that women are facing gender-specific challenges, including gaps in skills, lack of relevant education and training, and ignorance of export quality standards.

The unavailability of quality raw materials, dependence on neighbouring countries for raw materials, absence of skilled labour and issues related to market access, technology and innovation are other barriers, he added.

About 7.2 percent of Bangladeshi businesses are owned by women. There are only around 95,000 females among the 1.3 million retail micro-merchants in Bangladesh.

Sharmin Islam, gender team leader of UNDP Bangladesh, said a woman faces several social barriers when she goes to start a business.

"Just because she is a woman, she must face this situation. In the beginning, their family poses such obstacles. When she resolves these issues, the market poses another big barrier as it is unwilling to accept a woman as a businessman. The Bangladeshi market is not at all women friendly."

Sharmin added that the ecosystem required for a woman to become an entrepreneur has not yet been created in the country.

Mohammad Arifur Rahman Sheikh, director for research at the National Institute of Local Government, said the mindset of many posed a challenge to women looking to become entrepreneurs.

He added that they would continue to work to increase skills, create women entrepreneurs and develop the country's economy.

"By replicating proven models, simplifying financial processes, and enhancing information sharing, we can foster entrepreneurial growth. Facilitation of equity is imperative to ensure gender equality," said Mushfiqua Zaman Satiar, Senior Policy Advisor- Gender and Civil Society, The Embassy of the Kingdom of the Netherlands.

Mosharraf Hossain, director of social safety net at the Department of Social Services, said they have many initiatives that entrepreneurs are unaware of because they are far behind in terms of promotion.

For example, they offer a loan programme exclusively for women entrepreneurs. "Although the amount of money is Tk 50,000, it is not too low to start a new venture initially," Sheikh said.

Anwar Hossain Chowdhury, managing director of the Small and Medium Enterprise Foundation, said they are providing diversified support to existing and potential women entrepreneurs to position them in the mainstream business community.

Tanjim Ferdous, in charge of NGO's and foreign missions at The Daily Star, moderated the discussion.