Women in Southern India Hold Highest Count of Credit Score Tracking
A significant increase in the number of women seeking credit for business purposes is a notable trend in India, as revealed by the report "From Borrowers to Builders: Women's Role in India's Financial Growth Story" by NITI Aayog.
In 2024, women opened nearly 37 lakh new business loan accounts and took 4.3 crore loans for personal finance needs, according to the report. This represents a growing financial empowerment and entrepreneurship among women across sectors and regions in India.
Key findings from the report and associated studies include:
- The number of women seeking credit has tripled since 2019, driven by better data-driven lending systems and increased formal credit availability.
- The use of digital technology by women-owned enterprises, especially in the unorganized sector, helps reduce the gender gap in access to credit.
- A large number of women are actively monitoring their credit bureau reports, enabling better credit management and negotiating power with lenders.
- Women’s expanding role is not only limited to credit access but also includes rising participation in investments such as the stock market.
Despite progress, challenges persist such as the gender gap in loan approval rates and the need for more collateral-free lending avenues tailored for women entrepreneurs.
The southern region had the highest number of self-monitoring women, with 10.2 million women, and experienced a growth of 46% in self-monitoring women from December 2023 to December 2024. More women borrowers from non-metro regions are active in self-monitoring their credit, compared to women borrowers from metro areas.
The report shows that the number of women seeking credit in India has grown at a CAGR of 22% since 2019. In 2019, the number of new loan accounts for business purposes was approximately 8 lakh, with a total disbursement of Rs 0.7 lakh crore. In 2024, the total disbursement for these business loans was Rs 1.9 lakh crore.
Anna Roy, Principal Economic Advisor, NITI Aayog and Mission Director WEP, suggested that promoting women's entrepreneurship could create employment opportunities for 150 to 170 million people while driving women's participation in the labor force.
60% of borrowers come from semi-urban and rural areas, according to the report. The top five states for self-monitoring women were Maharashtra, Tamil Nadu, Karnataka, Uttar Pradesh, and Telangana, accounting for 49% of all self-monitoring women across all states.
The women's share of the total self-monitoring base increased to 19.43% in December 2024, up from 17.89% in 2023.
This shift towards women seeking credit and actively participating in the financial sector marks a transition from merely borrowing to actively building and shaping India’s financial growth story.
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