It is said that “Educate a man and you educate a man, but educate a woman and you educate an entire generation”. Today, the same very much holds true for financial independence among women. Empowering a woman, is equal to empowering an entire community. Access to credit help women hone their business acumen or meet their immediate financial requirements. Financial independence empowers women entrepreneurs to showcase their talent and expertise.

Funding available to women entrepreneurs is a key reflection of innovation and growth in any society. The ability of a nation to enable and nurture the growth of entrepreneurship amongst women is a measure of how developed the nation is.

Unfortunately, globally, women borrowers remain underrepresented and underfunded. Women account for 66% of the world’s working hours but only 10% of the world income. They produce 50% of the world’s food, yet possess only 1% of it’s wealth. Even today, they find it difficult to access organised credit. This is, despite the fact that women borrowers have huge potential.

Potential of women borrowers in India

There is a small but growing base of women entrepreneurs in India. About 14% of all micro, small and medium enterprises (MSMEs) in India are owned by women.

Further, with improved levels of education and employment, financial literacy and awareness amongst Indian women has also grown. There has been a significant increase in the number of women borrowers who monitor their own credit score and report. In terms of credit score consciousness, women borrowers grew by 71% between 2018 and 2020 more than six times the growth rate of male consumers over the same period.

With 4.7 crore active woman borrowers, 61% of the women consumers have a credit score greater than 720, whereas only 56% of male consumers have a CIBIL score greater than or equal to 720.

Women have historically made timely repayments when compared to their male counterparts. As compared to men, fewer women borrowers ask for moratorium. These factors make women borrowers popular with lenders, both institutional and retail.

Why Faircent?

Faircent is popular with women borrowers not only because of its simple, online processes, low cost, quick loans but also as Faircent evaluates every woman entrepreneur on the strength of her business ability. It caters to women borrowers from all walks of life, ensuring parity irrespective of marital or financial status. Faircent understands that a woman’s financial requirement is unique and hence it has a plethora of loan products specifically designed for women borrowers from both rural and urban India.

Loans catering to women borrowers

Women borrowers can directly apply for a loan on www.faircent.com. Loans are also sourced from aggregators and through sales and marketing initiatives. Each application will be evaluated using Artificial Intelligence (AI), Machine Learning (ML) & a new-age data centric approach to ensure fair and inclusive credit evaluation. Post evaluation, loans are listed directly on the lender dashboard under Term Loans for funding by lenders.

Faircent has also collaborated with various partners and Micro Finance Institutions to launch various Group Term Loans. Partners play an important role in on-boarding, credit evaluation, underwriting of borrowers and often provide support for disbursement and collection. Faircent enters into partnership only after considering the partner’s brand value, business vintage, ownership, bureau performance etc. These loans are listed on the lender dashboard under Term Loans>Group Loans.

While partners ensure credit evaluation of the women borrowers they onboard, it is done according to mutually agreed parameters. They ensure that the borrower does not have more than 2 active loans and the total EMI amount does not cross a minimum threshold level so as to not burden the borrower. In rural areas, the entire family’s income is considered. Income levels for rural and urban areas are evaluated differently. The borrower’s credit history is also considered.

Borrower profile for loans listed at present:

• Professionals, Entrepreneurs & women from rural India
• Mostly self-employed with small loan requirements for their enterprises
• Mostly married, age group 21 to 55 years with an average age of 30 years
• For loans disbursed in rural areas:
  • Credit facilitated to empower marginalized women engaged in small and medium enterprises. This helps them grow their business or meet working capital requirement.
  • Loans on Joint Liability Group model (JLG). A JLG comprises of 5-10 borrowers with similar socio-economic backgrounds and preferably from the same village who stand guarantee for each other. As a result, if any member of the group defaults, then the balance members will pool in resources and pay the defaulting member(s) share also. Loans issued under JLG, result in peer pressure by group members to make timely payment.
  • Loans with Co-Applicant. Each woman borrower in the group is further backed by an earning family member either as a co-applicant or a guarantor.

Women Empowerment 2, Women Upliftment, Social Impact Loans are some of the group term loans catering to women borrowers currently listed on the platform. These loans are in collaboration with well-know NBFC-MFI. Catering to women from rural and semi-urban India, all these loan products are under the JLG model.

There are 3 million women-owned enterprises in India which employ more than 10 million individuals. When a woman becomes financially independent, is able to grow her business and provide sustenance to those around her, she gains a voice among her peers and becomes a support for other women in her community.  

Empower women to grow their business and contribute positively to their families as well as to the economy. Help them meaningfully make a difference to their lives and to society. New demand goes live every day, so remember to invest in women borrowers today!

*Source: RBI Survey; **Report by Transunion CIBIL; ***Economic Times Article quoting Transunion CIBIL; # Article in Forbes India by WEConnect International