A review of our June networking event by Alexia Solomou
Roy Budjhawan is the head of Microfinance at ING Bank. On 23 June 2016, he delivered a presentation on women entrepreneurship. He underlined it’s importance by mentioning that 75% of his clients are women, mostly individual or group entrepreneurs.

Positive Effects

Roy started off his presentation by outlining the positive effects of women entrepreneurship. He stressed that it improves the financial independence of women. Roy mentioned that by investing in women, one invests in a community as a whole, because women tend to use the profit generated in business training, financial education and in the up-bringing and education of their children and extended family.

Negative Effects

Entrepreneurship can produce negative effects on women. For example, some women are threatened by their husbands in certain countries because they are no longer the main provider of the household. When women face problems with their business, they face increasing stress and pressure, while some fall into depression. Roy mentioned that a lot of women focus on lower return investment, due to the societal structure of the countries they live in, which burden them with family operational matters.

Optimisation of women entrepreneurship

Roy also mentioned that only approximately 5% of women enterprises grow to medium ones, whereas that percentage is 25% for men. He noted a trend among women that they want to pay back their loans as soon as possible, as he argued that do not feel comfortable with risk. One of the ways that women entrepreneurship could be optimised is for them to be trained, particularly in the management of their financial affairs and to conduct awareness training for their male counter-parts.

Women entrepreneurship in India and Ghana

Research conducted by ING has shown that microcredit boosts women empowerment. Given that women can generate profit by running their own businesses, they can have increased savings, which in turns entails a larger focus on nutrition, health and education of their families and a greater bargaining power and say in decision making. This eventually leads to the financial independence of women, but also in an important investment in the education of the younger generation, which will lead to their eventual empowerment in adulthood.

Question and Answer Session

While answering questions from the floor, Roy made a series of points regarding women entrepreneurship. Conditions of the loans for women vary from state to state. Women pay back much quicker, less of a risk for banks: 1% for women, whereas 2-3% for men. The rate of interest for loans is capped to 16% in India, depending on overhead costs and the inflation rate, which is based on local conditions. Furthermore, the funds are usually made available to women entrepreneurs via local partners and local banks, whereas ING provides the training, including financial management but also the marketing training.
Roy mentioned that loan officers go to villages in India or Ghana and they talk about it to groups of women. These news tend to spread quickly via underground informal networks. For example, in India a van was bought which includes all the materials required for the training, which makes possible the training of at least 200 women being trained per day. Another example is that of 400 women in Turkey, who will be given a full year of training by the ING, after the completion of which they will be able to get a loan if they wish to start their own business. A project that is currently underway is aiming to help underprivileged communities of women in The Netherlands.
A copy of Roy’s presentation is available to download here.
Reports and further information can be found here.

Alexia-Solomou-100Alexia Solomou is Associate Legal Officer at the International Court of Justice.