Villgro Drives to Shape Financial Inclusion for Women Entrepreneurs
Tuesday, 01 April 2025, 19:14 IST
India’s Economic Survey for 2024-25 has highlighted a concerning statistic: only about 20% of Micro, Small, and Medium Enterprises (MSMEs) in the country are owned by women. This finding emphasizes the urgent need to establish a supportive ecosystem for women entrepreneurs, complemented by government initiatives that focus on improving access to credit, formalization, and skills training. Villgro, a prominent social enterprise incubator, has been actively working for several years to enhance access to formal credit and innovative financing solutions for women micro-entrepreneurs across India.
As the financial year 2025-26 begins, Villgro has announced that its innovative financing solutions, in collaboration with partner organizations, have successfully enabled 106 women micro-entrepreneurs to secure business loans. By assisting those previously considered "unbankable" in obtaining the necessary funding, Villgro is not only empowering women-led enterprises but also contributing to a more inclusive financial ecosystem that strengthens livelihoods and fosters lasting socioeconomic impact.
Women entrepreneurs have consistently shown high loan repayment rates, making them some of the most dependable borrowers in the financial ecosystem. However, despite their strong performance, they receive only 5% of total commercial financing, according to Villgro’s "Beyond the Numbers" study. Systemic barriers such as risk perception, lack of collateral, and prevailing gender norms continue to hinder their access to funding. Villgro is addressing these challenges by introducing tailored credit solutions, peer-to-peer lending, and alternative funding mechanisms to bridge the gender financing gap in the country.
Vibha Sharma, Lead - Impact Finance at Villgro, stated, “Over the years, we have observed that many women micro-entrepreneurs in India remain underserved by traditional financial institutions. The lack of access to capital significantly constrains their business growth, limiting their ability to scale, adopt new technologies, and expand their market reach. Through various innovative approaches, we aim to enhance their access to credit while dismantling systemic barriers. The results have been incredibly rewarding. Hundreds of women-led businesses have not only expanded but also demonstrated strong repayment behavior, reinforcing the case for greater financial inclusion. The evidence is clear: women entrepreneurs are reliable borrowers, and supporting them can lead to a more inclusive and equitable economy.”
Here are a couple of key initiatives currently being implemented by Villgro, in partnership with its ecosystem collaborators, to uplift women-led businesses in India
Affordable Credit for Solar-Powered Income-Generating Opportunities
Villgro has teamed up with Ashv Finance to make solar-powered cooling solutions from DD Solar more affordable and accessible for rural women micro-entrepreneurs, particularly those in the fisheries sector. This partnership introduced an end-user loan facility backed by a First Loss Default Guarantee (FLDG), which covers 25% of potential loan losses with support from other partners. This initiative has unlocked over ₹1 crore in credit funding for underserved communities.
The results have been impressive: 362 loans have been disbursed, and 750 solar refrigeration units sold, with 44% of the loans going to women, many of whom were first-time borrowers. These women entrepreneurs have shown strong repayment behavior, with a non-performing asset rate of just 6%. The innovative cooling solutions provided by DD Solar have enabled these women to improve their fish procurement planning, reducing losses and enhancing their income and livelihoods. Following the success of this project, Ashv Finance has launched a second loan facility with reduced FLDG requirements, and with WE4F subsidizing 36% of product costs, financing has become even more accessible for women-led businesses.
Peer-to-Peer Lending for Livelihood Opportunities
Research indicates that 50% of farmers in India struggle to secure loans. To address this issue, Villgro has partnered with Rang De, a peer-to-peer lending platform, to help farmers adopt distributed renewable energy (DRE) technologies. This initiative allows farmers to repay loans using the income generated from these technologies. Rang De’s platform connects individual lenders directly with farmers, offering low-interest, easily accessible loans to fund climate-smart DRE technologies that promote agricultural innovation. By simplifying access to credit, this initiative has encouraged numerous women farmers to secure loans, enabling them to invest in sustainable technologies that enhance their productivity and income.
Looking ahead, Villgro remains dedicated to empowering women by providing them with access to finance, enabling them to acquire income-generating assets and improve their livelihoods. As Villgro continues to advocate for financial inclusion, it is also working to raise awareness among policymakers, investors, and financial institutions about the importance of investing in women-led businesses. Such investments not only yield strong financial returns but also create significant socio-economic benefits for families, communities, and the broader economy.
As the financial year 2025-26 begins, Villgro has announced that its innovative financing solutions, in collaboration with partner organizations, have successfully enabled 106 women micro-entrepreneurs to secure business loans. By assisting those previously considered "unbankable" in obtaining the necessary funding, Villgro is not only empowering women-led enterprises but also contributing to a more inclusive financial ecosystem that strengthens livelihoods and fosters lasting socioeconomic impact.
Women entrepreneurs have consistently shown high loan repayment rates, making them some of the most dependable borrowers in the financial ecosystem. However, despite their strong performance, they receive only 5% of total commercial financing, according to Villgro’s "Beyond the Numbers" study. Systemic barriers such as risk perception, lack of collateral, and prevailing gender norms continue to hinder their access to funding. Villgro is addressing these challenges by introducing tailored credit solutions, peer-to-peer lending, and alternative funding mechanisms to bridge the gender financing gap in the country.
Vibha Sharma, Lead - Impact Finance at Villgro, stated, “Over the years, we have observed that many women micro-entrepreneurs in India remain underserved by traditional financial institutions. The lack of access to capital significantly constrains their business growth, limiting their ability to scale, adopt new technologies, and expand their market reach. Through various innovative approaches, we aim to enhance their access to credit while dismantling systemic barriers. The results have been incredibly rewarding. Hundreds of women-led businesses have not only expanded but also demonstrated strong repayment behavior, reinforcing the case for greater financial inclusion. The evidence is clear: women entrepreneurs are reliable borrowers, and supporting them can lead to a more inclusive and equitable economy.”
Here are a couple of key initiatives currently being implemented by Villgro, in partnership with its ecosystem collaborators, to uplift women-led businesses in India
Affordable Credit for Solar-Powered Income-Generating Opportunities
Villgro has teamed up with Ashv Finance to make solar-powered cooling solutions from DD Solar more affordable and accessible for rural women micro-entrepreneurs, particularly those in the fisheries sector. This partnership introduced an end-user loan facility backed by a First Loss Default Guarantee (FLDG), which covers 25% of potential loan losses with support from other partners. This initiative has unlocked over ₹1 crore in credit funding for underserved communities.
The results have been impressive: 362 loans have been disbursed, and 750 solar refrigeration units sold, with 44% of the loans going to women, many of whom were first-time borrowers. These women entrepreneurs have shown strong repayment behavior, with a non-performing asset rate of just 6%. The innovative cooling solutions provided by DD Solar have enabled these women to improve their fish procurement planning, reducing losses and enhancing their income and livelihoods. Following the success of this project, Ashv Finance has launched a second loan facility with reduced FLDG requirements, and with WE4F subsidizing 36% of product costs, financing has become even more accessible for women-led businesses.
Peer-to-Peer Lending for Livelihood Opportunities
Research indicates that 50% of farmers in India struggle to secure loans. To address this issue, Villgro has partnered with Rang De, a peer-to-peer lending platform, to help farmers adopt distributed renewable energy (DRE) technologies. This initiative allows farmers to repay loans using the income generated from these technologies. Rang De’s platform connects individual lenders directly with farmers, offering low-interest, easily accessible loans to fund climate-smart DRE technologies that promote agricultural innovation. By simplifying access to credit, this initiative has encouraged numerous women farmers to secure loans, enabling them to invest in sustainable technologies that enhance their productivity and income.
Looking ahead, Villgro remains dedicated to empowering women by providing them with access to finance, enabling them to acquire income-generating assets and improve their livelihoods. As Villgro continues to advocate for financial inclusion, it is also working to raise awareness among policymakers, investors, and financial institutions about the importance of investing in women-led businesses. Such investments not only yield strong financial returns but also create significant socio-economic benefits for families, communities, and the broader economy.
