Unlocking ‘Viksit Bharat’: How Women-Led MSMEs Drive Sustainable Growth and Empower Communities

According to the Economic Survey 2024-25, only 22% of India’s micro, small, and medium enterprises (MSMEs) are owned by women. Many of these businesses are small, often run by a single person, and largely operate in traditional sectors like tailoring, food processing, and crafts. Despite making up nearly half of the population, women’s participation in entrepreneurship is surprisingly low.

This gap isn’t just about gender inequality; it represents a significant loss of economic potential. If India aims to become a developed nation by 2047, unlocking the potential of women entrepreneurs is essential.

Economists agree that empowering women-led MSMEs can have a broad impact. Research shows women typically reinvest 90% of their earnings back into their families, compared to 30-40% by men. This reinvestment leads to better health, education, and nutritional outcomes for children, thus strengthening communities and the economy.

Women entrepreneurs also contribute to job creation. Businesses led by women are more likely to hire other women, helping to bridge gender disparities in the labor market. They often operate in underserved areas, addressing local needs and fostering innovation in sectors like eco-tourism and bio-economy.

However, there are significant challenges. Women-led enterprises find it hard to secure formal financing. Less than 10% of women entrepreneurs access formal credit services, relying instead on personal savings or informal loans. Financial institutions often view their enterprises as high-risk despite evidence showing women-run businesses typically have high repayment rates.

In rural India, where many women lead self-help groups (SHGs), the opportunity for growth is even greater. Yet, many women lack the necessary collateral and formal credit histories required by banks. Social norms can restrict their movements and visibility. Despite the existence of various support programs, many do not adequately address the unique challenges faced by women entrepreneurs.

On a positive note, some programs aim to change this narrative. Initiatives like the Nari Adhikar Kendra (NAK) offer support systems for rural women, providing mentorship and market access. Digital platforms, such as the Open Network for Digital Commerce (ONDC), also break down barriers, enabling women to reach customers directly.

In addition, Corporate Social Responsibility (CSR) investments can play a vital role. While companies often channel CSR funds into low-risk projects, supporting women-led enterprises can yield significant returns. The India Philanthropy Report 2023 highlights how investing in women can lead to better social and economic outcomes.

As India strives for a $5 trillion economy, the potential of women-led MSMEs cannot be overlooked. Embracing this opportunity is crucial for economic growth and social progress. The question remains: Are we ready to take action?



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MSME, women entrepreneurs