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Indian Women-Led MSMEs Struggle to Secure Financing Despite Government Schemes

Persistent gaps in financing are hindering women entrepreneurs despite record registrations on the Udyam Assist portal.

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Overview

  • India’s MSME sector includes over 6.3 crore enterprises, contributes nearly 30% of GDP, generates 25–28 crore jobs and accounts for roughly 46% of exports.
  • Women-owned businesses make up about 20% of registered MSMEs but contribute only 10% of turnover and face a 35% credit gap compared to 20% for male-led firms.
  • Despite holding 64% of Pradhan Mantri MUDRA loan accounts, women-led enterprises receive just 41% of the scheme’s sanctioned funds.
  • More than 1.86 crore informal firms have formalized via the Udyam Assist portal this year, with 70.5% owned by women, yet many still struggle to secure formal credit.
  • West Bengal’s cluster funding, digital platforms and dedicated credit schemes have boosted women’s MSME ownership to 62%, offering a replicable model for other states.