Published in The Financial Express on Saturday, 8 March 2014.
Women in SMEs
Situation improves in urban areas but unchanged in villages
Doulot Akter Mala
Emergence of women entrepreneurship has changed the business landscape of Bangladesh. Financial empowerment of female workforce has added pace to the economic development. They proved themselves as successful entrepreneurs in diversified businesses ranging from handicrafts, boutiques to light engineering, banking to apparel, poultry to agro-businesses. Yet, total contribution of women workforce in economy remained unmeasured in monetary form. Even there is no data on number of women entrepreneurs in Bangladesh.
None of the private or public entities yet launch any comprehensive study to find out actual numbers of women entrepreneurs in Bangladesh to pay proper attention on the growing potential workforce.
In a secondary study conducted by the SME foundation it has been found that there were some 3500 women entrepreneurs in 2011 that increased to 8500 in 2013.
However, surveyors of the SME foundation are sceptic about the result of the study as the numbers of women entrepreneurs they had estimated were much higher than that of the findings.
Farzana Khan, deputy general manager of SME foundation, said in a gross estimation the foundation estimates about 10 per cent of the total women population are involved in businesses in Bangladesh.
Ms Khan, who is assigned to facilitate women entrepreneurs, said women are moving around some selective sectors with their investment due to lack of proper patronisation.
“We have found a substantial number of women entrepreneurs is involved in boutique businesses followed by fashion designing and beauty parlours,” Ms Khan said.
A study of the Bangladesh Women Chamber of Commerce and Industry (BWCCI) in 2010 revealed, economic activities of women entrepreneurs in Bangladesh is higher 41.6 per cent in manufacturing and trading followed by only export 10.6 per cent, wholesale 6.2 per cent, retail 13 per cent, service 12.8 per cent, both export and import 1.6 per cent.
Experts and women entrepreneurs laid emphasis on encouraging and supporting women entrepreneurs in diversified sectors.
Center for Policy Dialogue (CPD) research fellow Dr Fahmida Khatun said women entrepreneurs need constructive advice to help them enter other potential sectors for investment and take up challenges.
“Banks and financial institutions can take the responsibility of providing a guideline to women prior to disbursement of loans to the latter,” she said.
They can come up with a whole package to assist women entrepreneurs on best utilisation of their money, she added.
Most women entrepreneurs face problems in taking decision on the best utilisation of bank loans that they get at lower rate of interests, Dr Khatun said.
During the last five years access to finance became easier with the support of the Bangladesh Bank (BB’s) guidelines to the commercial banks. Many of the women entrepreneurs expressed their satisfaction over improvement in the situation relating to the access to finance in urban areas.
President of Metropolitan Chamber of Commerce and Industry (MCCI) Rokia A Rahman and founder of BWCCI Selima Ahmed expressed an identical view on the significant improvement situation relating to providing financial support to women entrepreneurs in urban areas. However, they laid emphasis on extending the similar facilities to women in rural areas.
Ms Selima Ahmed said rural women are getting access to microcredit but facing problems in arranging big loans.
Many private commercial banks have come up with SME packages for women entrepreneurs. But, in district towns, the scenario is quite different. Branch offices of some banks are reluctant to provide SME loans to women entrepreneurs fearing that the women entrepreneurs would not be able to make best use of the loan.
MCCI president suggested allocation of separate stalls for women in markets to encourage their in trading businesses.
“We have found that women are mostly engaged in informal sector where skill requirement and payment is low,” Dr Fahmida Khatun said.
It is utmost priority to focus on education and skill development of women to bring them in formal sector with higher ranges of pay structure, she added.
Ms Khatun, however, suggested supervision of the banks to check any unethical practices on enjoying soft loan by male counterparts.
In a survey to find out barriers on access to finance of women entrepreneurs, it has been found that a major part of the SME loan for women entrepreneurs is being enjoyed by men.
Such misuse of SME loan narrows the scope for growth of women entrepreneurship in Bangladesh.