By Tom Boyd
Around the world, women entrepreneurs are driving business growth in record numbers, yet they still encounter persistent financial barriers that limit their potential. The story isn’t about capability, it’s about unequal access to the capital that fuels growth, expansion, and innovation.
Here’s what the data reveals.
Women Are Starting Businesses — But Not Always Growing Them with the Same Support.
Women today are increasingly choosing entrepreneurship. According to recent studies, women founded nearly 49% of all new businesses in 2024, the highest rate seen in several years. This trend reflects a growing confidence and desire among women to build wealth, pursue independence, and launch ventures across sectors.
However, this surge in women-led business formation often doesn’t translate into equal access to financing, especially beyond the earliest stages.
Access to Capital: Women Still Face a Gap
One of the biggest barriers for women entrepreneurs is access to finance, especially when it comes to bank loans, equity investment, and venture capital.
Here’s what the data shows:
- Bank Loans and Traditional Financing
Women entrepreneurs are significantly less likely than men to use bank loans to start or grow their businesses.
Estimates suggest women are about 25% less likely to take out a bank loan for business purposes compared with men.
When women do secure bank financing, it often comes with less favourable terms: they may face higher interest rates or need to offer more collateral.
- Venture Capital Funding Is Far Below Parity
Venture capital (VC), a key source of growth funding is especially unequal:
- Women-only founding teams receive about 2% of total VC funding globally.
- In addition, when women do secure VC backing, they often receive only about 70% of the funding men receive on average.
- Women entrepreneurs are about 63% less likely to secure VC funding compared to their male counterparts.
Even in mixed-gender founding teams, women founders remain disproportionately underfunded relative to male-only teams, highlighting deep structural biases within investment markets.
Small Business Funding Trends: Incremental Progress, Persistent Gaps
Small business financing statistics show some positive movement, particularly for women applying for loans:
- In 2024, women-owned businesses had a 36% funding approval rate for financial applications, slightly higher than the 29% approval rate for men.
- The average funding amount for women-owned businesses also increased by about 25% from 2023 to 2024, rising from approximately $53,678 to $67,035.
- While these figures demonstrate progress, they also show that women still receive smaller loan totals than men overall and often start with less capital than male counterparts — meaning their businesses may be more constrained from the start.
The Real Cost of the Finance Gap
Why does this finance gap matter? Because capital isn’t just money, it’s opportunity.
Without adequate funding:
- Women-led businesses may struggle to expand, hire, or scale.
- Entrepreneurs may rely on personal savings or informal networks instead of long-term growth capital.
- Women can face delayed or stunted business growth even when their ideas and markets are strong.
A major global survey reported that more than 70% of women-owned SMEs have inadequate or no access to financial services. This contributes to a massive multi-billion-dollar financing gap worth hundreds of billions in uninvested capital.
In sub-Saharan Africa alone, women entrepreneurs face a combined financing gap estimated at about $42 billion, reflecting structural barriers in formal MSME lending.
Hope and Momentum
Despite these challenges, momentum is growing. The increasing share of loan approvals for women in 2024 signals a shift, and more initiatives are emerging globally to close the finance gap, from tailored lending programmes to public-private partnerships and targeted investment funds.
Still, the journey toward true financial equity for women entrepreneurs will require persistent policy changes, more inclusive investment practices, and greater representation of women in leadership positions within financial institutions.
Did you know?
While women now found nearly half of new businesses, only about 2% of total venture capital funds go to women-only founding teams, and women who secure VC funding often receive 30% less on average than men. This gap highlights why financial inclusion remains one of the most critical issues for women business owners today.
