Gold, a symbol of both beauty and wealth, has long held a special place in Indian culture. But for women entrepreneurs in the country, it’s also becoming an essential tool for securing funding. A recent survey, ‘Women and Finance,’ conducted by CRISIL and DBS Bank India, revealed that gold is a highly preferred collateral option for women seeking loans to start or grow their businesses.
The survey highlights a stark trend: Chennai leads the way with nearly 52% of self-employed women using gold as collateral for business loans. While Mumbai and Delhi see a similar trend, albeit at a lower rate (22-25%), Kolkata stands out with only 11% of women entrepreneurs using gold as collateral. This difference in preference likely reflects regional variations in financial access and cultural attitudes towards gold.
The survey also found that millennial women (aged 36-45) are more likely to use gold as collateral, with 23% of self-employed women in this age group opting for this route. This suggests that younger entrepreneurs are embracing gold as a practical and accessible financial resource.
While gold plays a significant role in securing loans, the survey reveals a gap in traditional banking access. Only 21% of women entrepreneurs prefer bank loans to fund their businesses, indicating a need for greater financial inclusion. In major metro cities, a significant percentage of self-employed women (65%) haven’t taken any business loan, relying on personal savings instead. This highlights the need for more targeted financial support for women entrepreneurs.
The survey shines a positive light on the progress made in digital adoption. A whopping 73% of self-employed women prefer receiving payments digitally from their customers, and 87% use digital methods to manage business expenses. The popularity of the UPI payment mode, used by 35% for receiving and 26% for paying business expenses, further underscores the success of initiatives like ‘Digital India’ in promoting digital financial inclusion.
Despite the widespread adoption of digital payments, cash remains the preferred method for payroll and operational expenses. This indicates that while digital financial tools are gaining traction, a hybrid approach still prevails among many women entrepreneurs.
