Going Beyond the Bank: A Female Entrepreneur

There remains a lot of unfamiliarity with financing options available to businesses, more specifically female entrepreneurs. Securing finance in any economic climate can be daunting, whether it is for expansion plans or an initial startup. However, with the use of comparison sites, women can now see a range of options available to them beyond traditional bank lending.

Impact of Unawareness

According to research done by Just Cash Flow, almost 35% of female entrepreneurs continue to abandon their investment or startup plans once they have been rejected for business loans by the more traditional lenders such as high street banks. This initial rejection and cease of plans stem mainly from their lack of knowledge of other options available to them such as in the alternative finance market. The limit to finance was further supported by the Maximizing Women’s Contribution to Future Economic Growth report conducted in 2013, where increased access and awareness to finance options for female business owners was a recommendation.

The Rise of Alternative Finance

We have seen incredible growth in the alternative finance market, with it increasing to a value of £3.2 Billion in 2015, almost doubling its 2014 value. This has been driven by the increased entrants onto the market varying from crowdfunding to online lending facilitation sites such as this Finnish example.

Benefits of Alternative Finance

New lenders continue to present opportunities to entrepreneurs to rapidly access the finance needed to pursue their growth plans. The speed and uncomplicated nature of this source of finance is perfectly suited to women attempting to juggle their career ambitions with their familial lives or women looking to start their own business from home, after taking time off to raise their children in the early years.

Women account for approximately 40 percent of the world’s workforce but continue to encounter barriers in accessing credit, hindering economic growth. In this Bank of America survey, it was found that almost 49% of female entrepreneurs interviewed still felt limited in the business advancement opportunities available to them and this was reflected in their funding sources. Bank loans and credit cards were the main sources of finance used by these women to expand their business. The increase in funding options and the advancement of technology supporting access to these options fuels the empowerment and increased choices for women, as the female gender continues to become more visible and equal competitors in the business world.

Thanks to Jane Sandwood