Department of B. Voc. (Retail Management & IT), St. Francis College for Women, Begumpet, Hyderabad – 16, Telangana, India
This study focuses on the rise of women entrepreneurs in India and their growth. It provides a brief insight into the impact of funding models on the businesses led by women. Additionally, this study sheds light on the various government schemes offered for women entrepreneurs and their effectiveness.
India’s booming startup ecosystem has created a new wave of entrepreneurs who are now leading the country’s economic growth. There has been a positive shift in the mindsets and people are now willing to become job creators and not job seekers. Among many positive outcomes, a noteworthy growth is the rise of women entrepreneurs who are fast taking the centrestage in the country’s entrepreneurial ecosystem. Historically, Indian women faced societal constraints in pursuing entrepreneurship. Despite this, they have always played a vital role, managing businesses passed down through generations or finding ways to contribute to the family income. Women entrepreneurs are now a rapidly growing segment, contributing immensely to the economy by generating jobs, solving societal problems and empowering themselves and their communities. They are breaking barriers and achieving success in diverse fields, from home-based ventures to established firms. While women entrepreneurs are driving economic progress, their growth journeys are often led by funding. This research delves into the complex web of funding models, analysing how traditional options like bank loans and venture capital, alongside innovative avenues like crowdfunding and angel investors, shape the trajectories of women-led businesses across diverse industries and regions.
THE RESEARCH PROBLEM
In recent years, the number of women-owned businesses has been on the rise, showcasing the progress made towards gender equality in entrepreneurship. According to a study by the World Bank1, the number of women-owned businesses in India grew by an impressive 17% annually between 2017 and 2020, outpacing the national rate of 7.5%. This translates to over 27 million women entrepreneurs - injecting dynamism and innovation into the economy. Women entrepreneurs are increasingly driving the Indian economy, with funding playing a crucial role in their growth. Diverse models like government initiatives, angel investors, crowdfunding, and impact investing are expanding, offering more accessible pathways to capital beyond traditional options. This aligns with findings from Bain & Company (2020) and The Associated Chambers of Commerce & Industry of India (2023)2, showing how 80% actively seek funding and demand has grown 30% in five years. These innovative models fuel innovation and expansion for a new generation of female leaders. Governments are increasingly recognising the potential of women entrepreneurs, implementing dedicated schemes and policies to unlock their talent and contributions. This study gives an opportunity to understand the preferred funding model chosen by women entrepreneurs and their impact on the business. The study creates an awareness about the various funding options available for women entrepreneurs.
OBJECTIVES OF THE STUDY
METHODOLOGY OF THE STUDY
The study used both qualitative and quantitative techniques. Quantitative statistics were obtained through a survey of women entrepreneurs across India, including 13 states. Qualitative data was gathered through interviews and observational method of various women entrepreneurs who are experts in their respective fields. The sample comprised 111 participants. The type of sampling used was Purposive Sampling. The sample consisted of women respondents across various age groups.
Source of Data
The study was supported by both primary and secondary data. Data collection was through structured interviews held with women entrepreneurs. Data related to entrepreneurship, funding models, government schemes and other figures were gathered via different sources available.
Period of the Study
The Period of study was from 2023 - 2024.
Scope of the Study
The geographical area chosen for the study was India. The respondents were from the age group of 18-60. This study was restricted to women entrepreneurs in India.
Limitations of the Study
The study was limited only to women entrepreneurs in India and could cover 13 states only.
REVIEW OF LITERATURE
Chandrasekhar and Matranga3 (2020), in their study titled “Venture Capital and the Gender Financing Gap: The Role of Accelerators”, had an objective to assess the role of accelerators in addressing the gender financing gap in venture capital, identify the challenges that women entrepreneurs face in accessing capital from accelerators and make recommendations on how accelerators can be more effective in addressing the gender financing gap. The report used a mixed-method approach, which involved collecting both quantitative and qualitative data. The study’s findings include that accelerators can help women entrepreneurs to access capital, build networks and receive training. However, the study also found that women entrepreneurs are less likely to be aware of accelerators, less likely to have access to networks, and less likely to have the confidence to pitch their businesses to investors. To be more effective in addressing the gender financing gap, accelerators should focus on providing women entrepreneurs with access to capital, building networks and providing training. They should also work to change the perception of women entrepreneurs among investors. The study concluded that accelerators can play a valuable role in addressing the gender financing gap, but more needs to be done. Kher4 (2018), in his study titled, “Closing Gender Gaps in India: Does Increasing Women’s Access to Finance Help?”, attempted to assess the impact of increasing women's access to finance on gender gaps in education, health and employment, to identify the challenges that women face in accessing finance in India and to develop policy recommendations for the government to increase women's access to finance. She conducted in-depth interviews on focus groups to collect qualitative data, and conducted a survey to collect quantitative data. The findings of the study suggested that increasing women's access to finance can have a positive impact on several areas, including female entrepreneurship, education and health. Women who have access to finance are more likely to start their own businesses, send their children to school and seek preventive healthcare. The study also found that the government can play a role in increasing women's access to finance by providing microcredit programs, training women in financial literacy and reforming the legal system to protect women's property rights. The conclusion of the study was that increasing women's access to finance is a valuable policy intervention that can help to improve the lives of women and their families. The government should continue to support efforts to increase women's access to finance and other stakeholders such as financial institutions and non-governmental organisations, should also play a role in this important work. Yoganandan and Gopalselvam5 (2018), in their study titled “A Study on Challenges Faced by Women entrepreneurs'', had as their objectives to find the problems encountered by women in starting their own business enterprises and to study the development of women entrepreneurs. The study focuses on general study of secondary data collected from various books, National & international Journals, publications from various websites which focused on various aspects of Women Entrepreneurship. The findings and the conclusion of the study were that women's participation in entrepreneurship is growing rapidly in India, but there are still many challenges that they face. These challenges include lack of access to finance, social and cultural norms and government policies. Despite these challenges, there are many successful women entrepreneurs in India who are breaking down barriers and paving the way for other women to achieve their dreams. The government and other stakeholders can play a role in supporting women entrepreneurs by providing access to finance, training and networks.
FINDINGS OF THE STUDY
Growth of Women Entrepreneurs in India
The study highlights a significant rise in women-led businesses across the country, with a strong presence in 13 states. Telangana (46.8%) and Haryana (23.4%) are leading the way, showcasing an encouraging trend of women embracing entrepreneurship. Notably, this growth spans various life stages, with the 26-35 age group accounting for 36.9% of women entrepreneurs, followed closely by 29.7% in the 36-45 age bracket, reflecting a growing generational spread.
Booming Sectors
Retail and E-commerce has emerged as the most dominant sector, accounting for 55% of women-led businesses. This surge highlights the increasing preference for online platforms and direct-to-consumer models. Beyond retail, women are also making strides in healthcare, education, and technology, indicating a diversification of their entrepreneurial ventures.
Challenges Faced
Despite their growing presence, women entrepreneurs continue to encounter notable challenges. Gender bias remains a persistent barrier, limiting access to networks, mentorship, and funding opportunities. Balancing work and family responsibilities adds another layer of complexity, making it harder for women to scale their ventures. Additionally, financial literacy gaps hinder many from effectively managing their business finances, which can restrict growth potential. Limited access to professional networks further compounds these challenges, creating obstacles to securing funding and expanding operations.
Motivational Factors
The study reveals that the rise of women entrepreneurs is driven by a mix of personal ambition, market-driven motivations, and financial independence. Many women pursue entrepreneurship out of a desire for flexibility, passion for their field, and the identification of market gaps. The COVID-19 pandemic acted as a catalyst, pushing several women towards entrepreneurship as a means of achieving financial stability and addressing the evolving demands of the market.
2. Government Policies and Their Impact
Government policies play a crucial role in supporting and empowering women entrepreneurs by providing access to funding, resources, and mentorship. The study examines the awareness, utilisation, and effectiveness of these schemes.
Scheme Awareness and Utilisation
The study reveals a high level of awareness about government schemes among women entrepreneurs. The Pradhan Mantri Rozgar Yojana scheme leads with 64.9% awareness, followed by Stree Shakti Yojana and Stand-Up India (both at 55.9%). Even the least-known schemes have a healthy awareness rate of 30.6%, indicating widespread knowledge of support programs. However, actual utilisation remains moderate. Pradhan Mantri Rozgar Yojana is the most utilised scheme, with 34.2% of women entrepreneurs benefiting from it. Other popular schemes include the Bharatiya Mahila Bank Business Loan Scheme and Stree Shakti Yojana, though their adoption rates remain relatively lower.
Sources of Awareness
Women entrepreneurs primarily learn about government schemes through word-of-mouth (30.6%), highlighting the importance of peer networks. Government websites (26.1%) and media reports (16.2%) also play a role in spreading awareness. Business seminars (14.4%) and networking events (12.6%) contribute further, offering direct exposure to these initiatives.
Effectiveness and Recommendations
While 95 entrepreneurs find the schemes effective in providing financial and logistical support, they recommend simplifying the application process and enhancing outreach efforts. A smaller group (16 participants) suggests offering personalised support and guidance to help women better leverage the available schemes.
3. Funding Impact on Women-Led Businesses
Funding plays a vital role in enabling women entrepreneurs to scale their businesses, access resources, and reduce financial strain. The study explores the funding models, benefits, and challenges faced by women-led businesses.
Funding Models
The study reveals that bootstrapping is the most common funding approach, with 57.7% of women entrepreneurs relying on personal savings or self-financing. This reflects their resourcefulness and independence in building their ventures. However, a growing number of women are turning to business accelerators and incubators (40.5%) for funding and mentorship support. Many also seek investments from angel investors, venture capitalists, and personal networks, valuing both the financial backing and the strategic expertise that comes with such partnerships.
Benefits and Burdens of Funding
Funding is viewed as a key driver of growth, providing entrepreneurs with the financial stability needed to expand operations, invest in marketing, and scale their businesses. It also reduces financial stress, allowing them to focus on long-term strategies. However, some entrepreneurs express concerns about the loss of control and the increased complexity of decision-making post-funding. This indicates a need for more equitable investment terms and better support systems to maintain entrepreneurial autonomy.
Impact on Business Growth
The study highlights a strong correlation between funding and business growth. 66.6% of women entrepreneurs report moderate to high growth, rating their business expansion between 3-4 on a scale of 5.
A smaller but significant group (11.7%) experiences the highest level of growth, rating their progress 5/5, while 4.5% report minimal impact. This demonstrates that while funding accelerates growth for most, some businesses require additional support or strategic guidance to fully benefit from it.
CONCLUSION
The study underscores the remarkable growth of women entrepreneurs in India, particularly in the Retail and E-commerce sector. Despite facing challenges such as gender bias, financial constraints, and work-life balance issues, women entrepreneurs continue to thrive, driven by independence, passion, and market opportunities. Government schemes play a significant role in providing support, but simplified application processes and personalised guidance could enhance their effectiveness. Funding emerges as a critical enabler of growth, providing women-led businesses with the resources needed to scale. However, ensuring equitable funding terms and better decision-making support will be key to their sustained success. Overall, the study highlights the resilience, innovation, and potential of women entrepreneurs, marking them as key drivers of India’s economic growth and transformation.
REFERENCES
Charvi Baid*, Dr. Subi Varghese, The Impact of Funding Models on The Growth of Women Entrepreneurs in India, Int. J. of Pharm. Sci., 2025, Vol 3, Issue 4, 3113-3118. https://doi.org/10.5281/zenodo.15284212
10.5281/zenodo.15284212
