When we all talk about women empowerment and equality, it includes having a fair share of support and opportunity for all, regardless gender or economic scenarios. Empowering our women for entrepreneurship and job opportunities are essential in current modern times. However, the ratio of women entrepreneurs is very less for several barriers and after Covid 19, this small portion has been vulnerable to any more crisis.
What is women entrepreneurship?
Women who own or lease enterprises are considered to be entrepreneurs. Women’s entrepreneurship in Bangladesh is a means of generating money for women as well as a path to reaching financial independence. The Bangladesh Bank (BB) adheres to the concept established in the 2016 Industrial Policy.
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“A female is an entrepreneur if she is the owner or proprietor of a privately-run business, organization or owns at least 51% share in a joint venture or company listed with the Registrar of Joint Stock Companies and Firms.”
Condition of Bangladeshi women entrepreneurs
In Bangladesh, women’s labor force participation had increased significantly from 15.8 percent in 1995-96 to 35.6 percent in 2016. Only around 12 percent of them had become entrepreneurs.
Women make up approximately 49.42% of Bangladesh’s population, and nearly 71.18 % of them are literate. Nonetheless, only 7.2% of the nation’s businesses are headed by women. It was 2.80% (0.10 million) in 2001, indicating that an increasing number of women are becoming business owners. It is gratifying to see that the number of women entrepreneurs in the country has increased significantly over the past several years. This increase is mostly related to a growing awareness among our women to become financially independent by engaging in economic activities in addition to their traditional household responsibilities. The government’s efforts to support women’s entrepreneurship have also contributed to the success of the initiative.
After covid 19 lockdowns and post pandemic job crunch, many women are entering into businesses as entrepreneurs as well.
Women entrepreneurship in urban area
During the years of 2000 and 2017, the percentage of urban Bangladeshi women entrepreneur had increased from 23.9 percent to 36.3 percent. The rate is expected to increase to 82 percent during the following decade and contribute up to 1.8 percent to the country’s GDP.
There are women-owned businesses in every area of the economy, but they tend to be concentrated in trading-based or cottage industries. Women entrepreneurs in urban areas engage in a variety of enterprises, including Handicrafts, Parlor, Boutique House, Cloth, Business, Grocery, Stationery, Agro-Based Business, Knitwear and ready-to-wear, Educational Services, Catering, and Bakery, etc.
Furthermore, online business in Bangladesh is thriving at the moment. The F-commerce (Facebook commerce) market is growing more accessible, with more women operating enterprises from home or on the go. According to the 2019 IDLC Financial Sector Study, Facebook’s market size in Bangladesh was valued at Tk 312 billion, and fifty percent of Facebook stores were operated by female entrepreneurs. It appears that urban women have superior access to online business resources.
Women entrepreneurship in rural area
Around 7.5%, or 439,000, of the 5.8 million rural firms in Bangladesh are owned by women. In addition, these businesses are focused in tailoring, textiles, and bamboo and cane products, which are typically not high-growth industries. The tiny size of these businesses reflects this fact. In rural Bangladesh, women-owned businesses employ 0.84 full-time employees, while men-owned businesses employ 1.55, or nearly double. In fact, 64% of women-owned businesses do not employ any full-time workers, indicating that these are unorganized, small-scale enterprises. They are now getting out of the agricultural jobs and engaging in various businesses to as owners.
Urban vs rural female entrepreneurs
The urban women have comparable advantages over their rural counterparts in managing their SME. They mostly come from middle-class and upper-middle-class backgrounds. Many of them are relatively better educated, intelligent, urbanized, and westernized, as well as devoid of social and religious biases. Women in the capital city of Dhaka, for example, are more innovative, resourceful, and fearless, and are able to assume financial and administrative duties. They engage in a variety of entrepreneurial endeavors, ranging from interior design to jewelry production, catering to beauty parlor and spa services, boutiques and handicrafts to export-oriented businesses. The cities are typically more accommodating to women since they provide more government and non-government organizations that provide essential services. The tendency has changed to manufacturers, exporters, and even order suppliers run by women.
Women living in rural areas are also showing interest of being entrepreneur and independent. We can see the rising trend of female entrepreneurs who are now literate, competent and self aware and running businesses smoothly. Though they may not have enough resources yet they manage to run their business and support family with their earnings.
Are the barriers same?
Women from both urban and rural economy face barriers while being entrepreneurs, the only difference is urban women face less social and financial barriers than rural women entrepreneurs.
The society has failed to abandon its negative view of women-owned businesses. Entrepreneurial women frequently encounter domestic violence and other societal and familial obstacles. It is also puzzling that women are predominantly employed in a small number of traditional economic areas. For many, family support is nearly nonexistent, and they must also struggle for the self-assurance they shown when expressing a desire to start something independently.
The fact that women’s proportion of overall loan distribution has not increased over the past few years, despite rapid development in female entrepreneurship and good payment behavior, demonstrates that it is still difficult for women entrepreneurs to gain funding in the country. Girls have a tougher time of it than men do. A bank loan is harder to come by for a woman in business than it is for a male. If you want a business loan from a bank, you’ll need a valid license to conduct business and a guarantee. Women, especially students, may find it difficult to fulfil all the requirements for a business license. The Asia Foundation conducted a survey in 2018 that found that between January and June of 2019, the Bangladesh Bank loaned out a total of Tk 800 billion in small loans. Although women owned 22% of the businesses, just 7% of the winners were female.
Family expectations: Household chores, taking care of the elderly, and raising children all take time away from women, making it difficult for them to advance professionally. Because the female entrepreneur tends to take care of most of the household chores, male business owners can focus on their ventures without worry.
Scenario is changing!
Bangladesh is on track to become a middle-income country by 2040, and the prime minister has made it her personal mission to ensure that all women in the country can realize their full potential.
The “Small Enterprise Refinancing Scheme” was created by the Bangladesh Bank to offer loans to female business owners at a maximum interest rate of 5%. Banks and non-bank financial entities will receive funding from the central bank at a rate of 0.5% interest, with the expectation that the funds will be lent out at a rate of 5%. Financial institutions might consider a third party personal guarantee as supplementary collateral to lend a woman business owner up to Tk25 lakh under the refinancing scheme. The government has mandated that at least 10% of the loan guarantee program be made available to women business owners through banks and other financial institutions.
When it comes to female business ownership, we still have ways to go before we can call ourselves a global leader. Despite the fact that women make over half of Bangladesh’s labor force, women only hold a small percentage of the country’s industrial and commercial organizations (less than 10%).
Women and girls in Bangladesh, in both the city and rural area, play a crucial role in the country’s development and advancement. Women should not be relegated to the roles of housewives and personal aides to males or treated as second-class citizens in their own households. This is the moment for them to stand up for themselves, speak up as one, and demand their fair share of the benefits of any efforts to achieve sustainability.