The rise of women-owned Micro, Small, and Medium Enterprises (MSMEs) in India marks a significant milestone in the country’s economic landscape. As of July 23rd, 2024, the number of women-owned MSMEs has reached a remarkable figure of 1,84,59,809, representing 39% of the total MSMEs. This surge is largely attributed to various government initiatives aimed at enhancing the participation of women in the MSME sector.

Udyam and Udyam Assist Platforms: Transformative Tools for Women Entrepreneurs

The Udyam platform, launched on July 1st, 2020, and the Udyam Assist Platform (UAP), introduced on January 11th, 2023, have been pivotal in driving this growth. These platforms provide a streamlined registration process for MSMEs, making it easier for women entrepreneurs to formalize their businesses and gain access to various government benefits and schemes.

The Udyam platform’s user-friendly interface and the comprehensive support offered by the UAP have empowered women across the country to step into the entrepreneurial ecosystem with confidence. By offering a simplified registration process, these platforms ensure that more women-owned enterprises can avail themselves of the benefits meant for the MSME sector.

Public Procurement Policy Amendment: A Game Changer

One of the critical government initiatives is the amendment to the Public Procurement Policy in 2018. This amendment mandates that central ministries and departments procure at least 3% of their annual requirements from women entrepreneurs. This policy not only provides women-owned MSMEs with substantial business opportunities but also encourages larger participation of women in government procurement processes.

The 3% procurement mandate is a significant step towards ensuring that women entrepreneurs have a fair share of the government’s purchasing power, which can be a substantial boost for their businesses. By securing government contracts, women-owned MSMEs can achieve greater financial stability and growth.

Credit Guarantee Scheme: Enhancing Financial Access

Financial access remains a critical challenge for many entrepreneurs, particularly women. To address this, the government has revised the credit guarantee scheme for MSMEs, offering up to 85% guarantee coverage for women entrepreneurs compared to 75% for others. Additionally, women entrepreneurs receive a 10% concession in annual guaranteed fees.

This enhanced credit guarantee scheme ensures that women entrepreneurs can access the necessary financial support to start and grow their businesses. By providing higher guarantee coverage and fee concessions, the scheme reduces the risk for lenders, encouraging them to offer more credit to women-owned MSMEs. This access to finance is crucial for scaling up operations, investing in new technologies, and expanding market reach.

Impact and Future Prospects

The impact of these initiatives is evident in the substantial increase in the number of women-owned MSMEs. The rise to 1.84 crore women-owned enterprises reflects the growing confidence among women entrepreneurs and the effectiveness of the government’s supportive measures.

Looking ahead, continued support and enhancements to these initiatives can further boost women’s participation in the MSME sector. Additional measures, such as mentorship programs, skill development workshops, and networking opportunities, can provide women entrepreneurs with the knowledge and resources they need to succeed.

Moreover, the integration of digital tools and platforms can further streamline processes and make resources more accessible to women entrepreneurs in remote and rural areas. By leveraging technology, the government can ensure that support reaches every corner of the country, enabling more women to start and sustain successful businesses.

Conclusion

The significant growth in women-owned MSMEs in India is a testament to the effectiveness of government initiatives aimed at fostering women’s entrepreneurship. With over 1.84 crore women-owned enterprises now active, representing 39% of the total MSMEs, India is making considerable strides towards economic inclusivity and empowerment.

Government platforms like Udyam and Udyam Assist, along with policies such as the Public Procurement Policy amendment and the revised credit guarantee scheme, have been instrumental in this progress. Continued efforts to support and enhance these initiatives will be key to sustaining and further accelerating the growth of women-owned MSMEs in India.

By creating a conducive environment for women entrepreneurs, the government is not only promoting gender equality but also driving economic growth and innovation. The success of women-owned MSMEs is a critical component of India’s broader economic development strategy, and with ongoing support, this sector is poised to achieve even greater heights in the future.

Join our Trading with CA Abhay Telegram Channel for regular Stock Market Trading and Investment Calls by CA Abhay Varn - SEBI Registered Research Analyst & Finance Saathi Telegram Channel for Regular Share Market, News & IPO Updates

Start your Stock Market Journey and Apply in IPO by Opening Free Demat Account in Choice Broking FinX & Upstox.