Access to finance, market paving way for women entrepreneurs

Raisa Maniza Akter, a small entrepreneur who makes paintings, artifacts and jewellery, used to rely heavily on online sales or fares as she has no outlet of her own.

But after participating in a recent programme organised by SME Foundation that connects small and medium entrepreneurs (SME) with large corporations, she gained access to a bigger market for her products.

Like the buyer-seller summit, the SME Foundation, the Bangladesh Small and Cottage Industries Corporation (BSCIC) and other government agencies have taken up a number of measures to promote the women entrepreneurs in the country.

Easy access to finance, exploring new markets, extending tax-free income limit, training and reserving quota at fares are some of the most notable measures recently taken by the government for empowering women entrepreneurs.

According to the Economic Survey 2013 by Bangladesh Bureau of Statistics, a total number of business establishments in Bangladesh was 7.82 million, of which only 7.21% were owned by women.

Out of 7.4 million working proprietors, only 5.9% were women.

People involved in this sector said the number of women entrepreneurs in the country has been increasing rapidly in recent years due to the supportive working environment and various government incentives. However, no government agency or organisations of SMEs have recent data on this.

SME Foundation Managing Director Md Mafizur Rahman told The Business Standard, "Many women want to be entrepreneurs now, but a few years ago the picture was almost the opposite."

"Women are becoming entrepreneurs because of the government's emphasis on creating women entrepreneurs and policy support for business facilitation, low-interest loans and skills development, training and product market expansion," he said.

"Earlier, women could not market their products smoothly after making them. So, currently we are working to get access to new markets for selling the women entrepreneurs' products," he added.

Mirza Nurul Ghani Shovon, president of the National Association of Small and Cottage Industries of Bangladesh (NASCIB) told TBS, "The image of women entrepreneurs has changed a lot from what it was five years ago."

"The biggest hurdle for women entrepreneurs was securing financing. We have removed this obstacle. Now we have to focus on improving the quality of the product," said Mirza Nurul Ghani Shovon, who is also the director of the board at the SME Foundation,

Apart from developing the entrepreneurs' skill and the quality of the products, BSCIC is reserving a special quota for allotting industrial plots to women entrepreneurs in industrial cities.

The SME Foundation is providing training, access to new markets, and one-third quota facility at various fairs to encourage women.

Easy access to finance

Access to finance was a major problem for women entrepreneurs, who started businesses with little capital but found it extremely difficult to get bank loans to expand their businesses as they often could not provide the necessary documents.

The SME Foundation has ensured easy loans for women entrepreneurs by involving them with the banks under its Credit-Wholesaling-Programme. Often the officials of the foundation are acting as the focal persons to give loans to the women entrepreneurs.

Under this programme, 2,186 entrepreneurs across the country received Tk121 crore loans till 31 December, 2021. Among them 24% were women entrepreneurs.

Besides, the SME Foundation has so far disbursed Tk300 crore out of the Tk1,500 crore incentive announced by the government, where the allocation for women entrepreneurs was about 30%.

Women in rural areas who could never borrow money from a bank previously, managed to receive a loan under this programme.

Connecting buyers and sellers for expanding market

According to the SME Foundation, 20% of women entrepreneurs identified marketing of products as their main problem.

Women entrepreneurs found it difficult to sell their products even after improving their quality as they did not know where to supply those goods other than the local markets.

To solve this problem, the SME Foundation has been organising a match-making summit for entrepreneurs and buyers for the last six years.

Around 60 women entrepreneurs participated in the latest summit organised in March this year.

They showcased their boutique products, jute products, leather goods, handicrafts, jewellery, for online marketplaces, chain-shops, Aarong, Anjans, Kay Kraft, and other corporate entities.

Tax-free income limit extended

The government has increased the tax-free income limit for women entrepreneurs to ensure their economic and social empowerment by increasing their participation in the economy.

In the 2021-22 budget, the tax limit on business turnover for women entrepreneurs has been raised from Tk50 lakh to Tk70 lakh.

30 women entrepreneurs to showcase products in New York

With the funding of a foreign organisation, the SME Foundation has trained 30 women. Fourteen of them will exhibit their products at a fair in New York in August this year, while the rest will participate in a similar exhibition in January next year.

Md Mafizur Rahman said, "It is a very positive thing that women entrepreneurs from the local small and cottage industry will showcase their products on foreign soil as we are emphasising on making women exporters. The foundation aims to export products worth $250 million – made by women – in the next three years."