problems and challenged faced by rural … and challenged faced by rural women entrepreneurs in ......

Asia Pacific Journal of Research Vol: 2. Issue XXXVII, March 2016

ISSN: 2320-5504, E-ISSN-2347-4793

www.apjor.com 93

PROBLEMS AND CHALLENGED FACED BY RURAL WOMEN

ENTREPRENEURS IN INDIA

J.Shyamala,

Assistant Professor,Department of Commerce,

Sree Saraswathi Thyagaraja College, Pollachi (TK), Coimbatore (DT), Tamilnadu

ABSTRACT

In India, 65% of population lives in rural areas. Women population is 50 % share of general

population. Therefore, rural women need to turn up into entrepreneur which is an important factor in socio-

economic development. However, there is increasing evidence that more and more women are showing

interest in small business ownership and actually starting up with the business, the status of rural women

are bounded to low level. Traditionally, it is believed that women are physically and mentally weak, and

hence, they are not fit for hard, hazardous and risky tasks. In India, still there are many social and cultural

restrictions on women. Hence, women participation in entrepreneurial activities is less than the requirement

of the fast growth of India. Thus, in this article, an attempt has been made to find out the various factors that

motivate women to enter into business, the various problems faced by the rural women Entrepreneurs in

establishing and running their business in terms of finance, marketing, social, cultural and provide

suggestions to overcome the problems and empower in their business.

Introduction: Entrepreneurship is the core of Economic development. Entrepreneurship is necessary to establish

the process of economic development of both developed and developing countries. It is also instrumental in

sustaining the process of economic development. Every country tries to achieve economic development for

richness, success and better life of society. So the contribution of both men and women is important in

building a healthy nation. The emergence of Women Entrepreneurs and their contribution to Indian economy

is transparent and very much visible in India. In India, the women Entrepreneurs have grown over a period

of time, especially in last two decades.

The mainstream of Indian economy has always been the unorganised sector. Unorganised sector

constitutes the major sector, especially in providing the employment opportunity in the economy. There is no

doubt in ensuring that, the unorganised sector in developing countries that makes a significant contribution

towards domestic product, and is a major source of entrepreneurship.


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In most developing countries, like India, women are the active players in the informal sector

(mbeehe, 2002). It is estimated that women Entrepreneurs account for about 10% of the total entrepreneurs

in India (Barhate, 2012). Though many women entered into the world of business and have become

successful entrepreneurs, the rate of their participation in the business is very low, in spite of its increase in

last one decade. This growth rate of women‟s participation in economic activities is lower than the

participation of women in developed countries. Thus, in this article, an attempt has been made to find out the

various factors that motivate women to enter into business, the various problems faced by the rural women

Entrepreneurs in establishing and running their business in terms of finance, marketing, social, cultural and

suggestions to overcome the problems and empower women in their business.

Definitions:

Entrepreneurship Entrepreneurship means different things to different people. Conceptually and in practice, the

term hints of no stereotypical model. Yet it‟s very etymology- derived from the French, „entreprendre‟,

which literally means, „to undertake‟- indicates the minimum characteristics of an Entrepreneur. From the

perspective of economic functions, three crucial characteristics of entrepreneurial activities are: risk taking,

innovation and venturing into new business activities for profit. Entrepreneurship is the, “process of creating

something new with value, allocate the necessary time and effort assuming the risk and reward”.

Richard Cantillon was the first to introduce the term, “entrepreneur”. He defined an

entrepreneur as “the agent who buys means of production at certain prices in order to combine them into a

product that he is going to sell at prices that are uncertain at the moment at which he commits himself to his

costs” (Richard Cantillon 1951).

In terms of Schumpeter concept of innovative entrepreneurs “Entrepreneurship is based on

purposeful and systematic innovation. It included not only the independent businessman but also company

directors and managers who actually carry out innovative functions” (Schumpeter J. 1959).

Women Entrepreneurs The Government of India has defined Women Entrepreneurs based on women participation in equity

and employment of business entrepreneurs. Accordingly, a Woman Entrepreneur is defined as “an enterprise

owned and controlled by a women having a minimum financial interest of 51 per cent of the capital and

giving at least 51 per cent of employment generated in the enterprise to women”. However this definition is

subject to criticism mainly on the condition of employing more than 50 per cent women workers in the

enterprises owned and run by the women (Khanka S.S. 2007).

Women entrepreneurs are those women, “who generate business ideas, identify profitable business

opportunities, assemble the necessary resources, combine the factors of production, undertake risks and use

their business skills to operate the enterprise for the purpose of generating profit income and growth” (Sudha

G.S. 2007).

Rural Women Entrepreneurs are those entrepreneurs who actually reside in rural areas and mobilize

human resources requirements from those areas in which they live. A rural women entrepreneur is a woman

or group of women who undertake to organise and run an enterprise in a rural area.

Unorganised Sector: The definition of unorganised sector given by the fifteenth International Conference of

Labour statisticians in 1993 is regarded as a group of household enterprise owned by households that

includes informal own-account enterprises, which may employ contributing family workers and employees

on an occasional basis and enterprise of informal employers, which employ one or more employee on a

continuous basis.


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According to NCEUS (2007), “The unorganised sector consists of all unincorporated private

enterprise owned by individual or households engaged in the sale and production of goods and services

operated on a proprietary basis and with less than ten total workers.

Rural Women Entrepreneurship - Indian Scenario: In India, 65% of population lives in rural areas. Women population is 50 % share of general

population. Therefore, rural women need to turn up into entrepreneur which is an important factor in socio-

economic development. However, there is increasing evidence that more and more women are showing

interest in small business ownership and actually starting up with the business, the status of rural women are

bounded to low level.

Traditionally, it is believed that women are physically and mentally weak, and hence, they are not fit

for hard, hazardous and risky tasks. But with the increasing empowerment of women in the world, now no

job, profession or enterprise is such which women cannot undertake. Contrary to it, it can be observed that in

oriental societies the women are borne- risk seekers. They grow up with the feeling of management of risk

and adjustment/adaption with the changing environment. Though Women entrepreneurship is a recent

phenomenon in India, which came into prominence in late 1970‟s now we see that more and more women

are venturing as entrepreneurs in all kinds of business and economic activities and service sector. Though at

the initial stage women entrepreneurship developed only at urban areas, lately it has extended its wings to

rural and semi-urban areas too.

Women industries mainly fall into informal sector where less than 10 persons with or without power

and less than 20 persons without power are engaged and they will be of labour intensive and rely on

indigenous resources, family ownership and only small scale skills are sufficient. Though earlier women

concentrated much on traditional activities, due to the spread of education, favourable government policies

towards development of women entrepreneurship, women have changed their attitudes and diverted towards

non-traditional activities. They show favourable response to changing situations and get adjusted to them

and have improved their position.

The Government and Non –Government organisations are giving more prominence to promote self

employment among women and build women entrepreneurship. Special financial assistance is provided and

training programmes are organised for women to start their ventures. Therefore, as a point of impact of it, in

modern age, especially in last ten years in India, the structure of ownership in the Industrial sector, in

agriculture, in trade and commerce has evidenced major changes. Many women entered the world of

business and have become successful entrepreneurs in various business activities. However, the rate of

participation in the business world is very low, in spite of its development during the last ten years. In India,

still there are many social and cultural restrictions on women. Hence, women participation in entrepreneurial

activities is less than the requirement of the fast growth of India.

When male and female entrepreneurs have been compared, the focus on women entrepreneurs still

accounts for only 6-8 percent in International research on entrepreneurship development. Actually,

Entrepreneurship represents an appropriate opportunity for women, as entrepreneurship respond flexibly to

entry, change and innovation. This potential has not yet been realised in an optimal fashion in most

developing country like India. There are a variety of constraints on women and the ability of women to

upgrade their production continuously. These include poor access to market information, technology and

finance, poor linkages with support services and an unfavourable policy and regulatory environment, these

constraints are further compounded by the need to compete in an aggressive business environment with rapid

technological changes and the globalization of production, trade and financial flows

Objectives of the study The main objectives of the study are as follows,

i) To find out the various reasons that influences rural women to become an entrepreneur


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ii) To examine the various problems faced by women entrepreneurs in establishing and running

a business enterprise

iii) To offer suggestions to overcome the problems faced by women entrepreneurs and improve

their business

Methodology The present study is an empirical study based on Secondary data. The secondary data have been

collected from various websites, published books, Journals, Periodicals etc.,

Review of Literature Syed Abdul Hameed (2015), has studied, “The Problems and Prospects of Women Entrepreneurs in

India”. The study focused on various factors influencing women entrepreneurship and recommended

measures for removal of obstacles to women entrepreneurship from the Indian perspective. The study

identified that, it is the need of the hour to motivate women entrepreneurs to harness the unexplored areas of

business venture and scale greater heights

G.Henry James and Dr.K.Satyanarayana(2015), has conducted an empirical study on “Women

Entrepreneurship in India –Problems and Prospects”. The researcher focused on the status of women

entrepreneurs, problems faced by them and also offered suggestions for overcoming the constraints. It has

been recommended that, there should be efforts from all sectors to encourage the economic participation of

women and the country should rise to the challenge and create more support systems for encouraging more

entrepreneurship amongst women.

Dr.Vijayshree and B.Hema (2011), have conducted a study on, “Problems and Prospects of Women

Entrepreneurs in Informal Market in Chennai. The main objectives of the study was to findout the

hindrances of Women Entrpreneurs in informal market and also to study their level of satisfaction of women

entrepreneurs in conducting their business. Non-probability convenience sampling technique was used and

data were collected from 150 respondents using questionnaire. Statistical tools such as simple percentage

and chi-square test were used and found out that, the finance and cultural factors especially on economic

angle were the major constraints that affected the growth of women. Further, all the respondents revealed

that they had a very modest living

Brijesh Patel, Kirit Chavda (2013), have conducted a study on, “Challenges and Problems of Rural

Entrepreneurship in India”. The study has stated that, the major problems faced by rural women

entrepreneurs are especially in the fields of marketing of Products, Financial amenities and other primary

amenities, i.e. availability of electricity, water supply, transport facilities and required energy etc.,

Factors Motivating Rural Women to involve in Business Activities: Many studies indicate that women start businesses for fundamentally different reasons than their

male counterparts. Women most often found businesses in order to meet personal goals, such as gaining

feelings of achievement and accomplishment. In many instances, women consider financial success as an

external confirmation of their ability rather than a primary goal or motivation to start a business, although

millions of women entrepreneurs will grant that financial profitability is important in its own right.

Many researchers drew inferences on factors influencing the women to become entrepreneurs. The

gist of all the researchers accord that the following are the major reasons for women entrepreneurship.

* Need for Power *Getting self actualization

*Seeking Independence * Need for achievement

* Presence of knowledge and skills * To become a leader

*Economic compulsion * Inspiration from others success

* Frustration in the present job * Motivation towards new enterprise

* To get control over the business * Not finding a right/ suitable job

* Need for additional income * Thrust to create new things


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Problems faced by Women Entrepreneurs in India There are a number of problems faced by women entrepreneurs in India. The problems may be

categorised into,

Personal problems such as Dual commitment, lack of support from family members, lack of self

confidence, education, psychological problems etc.,

Social problems such as Male dominated society, different social attitude, lack of Government

support, etc.,

Business related problems such as scarcity of finance, paucity of raw materials, marketing problems

exploitation by middlemen etc.,

The problems and hindrances experienced by women entrepreneurs have resulted in

restricting their into business and expansion of business. The major problems faced by the women

entrepreneurs are as follows,

1. Being Women

The first and foremost problem for a Women Entrepreneur is being a woman. The male

dominated society builds blocks for women‟s success in business

2. Lack of Confident

Lack of self-confidence, will power, strong mental outlook and optimistic attitude amongst

women creates a fear from committing mistakes while doing their piece of work

3. Paucity of Funds/ Difficulty in Obtaining Finance

Unlike big public firms, tiny firms cannot have access to primary and secondary markets.

Women in developing country have little access to funds, due to the fact that they are concentrated in

poor rural communities with few opportunities to borrow money. The women entrepreneurs lack

acess to external funds due to their inability to provide tangible security. If they don‟t have proper

funds, the ideas cannot become real.

4. High Production Cost

High production cost of some business operations adversely affects the development of

Women entrepreneurs. The installation of new machineries during expansion of the productive

capacity and like similar factors dissuades the women entrepreneurs from venturing into new areas

5. Male – Female Competition

Though the women entrepreneurs considered good in keeping their service prompt and

delivery in time, due to lack of organisational skills compared to male entrepreneurs‟ women have to

face constraints from competition

6. Legal Formalities

This kind of problem is faced by the entrepreneurs who enter into business without any

preparation. So, they face some legal formalities such as the trademarks, copyrights and intellectual

property problems.

7. Women’s Family Obligation

Having primary responsibility for children, home and older dependent family members, few

women can devote all their time and energies to their business. The financial institutions discourage

women entrepreneurs on the belief that they can at any time leave their business and become

housewives again.

8. Women’s Emphasis to Family Ties and Relationship

Married women have to make a fine balance between business and home. Moreover the

business success depends on the support, the family members extended to women in the business

process and management. Absence of proper support, cooperation and backup for women by their

own family members force them to drop the idea of excelling in the field of entrepreneurship


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9. Risk Bearing Capacity

Any kind of business is considered as continuous risk taking and strategic decision all the

time. Investing money, maintaining the operations and ploughing back money for surplus generation

requires high risk taking attitude, courage and confidence. Whereas, low-level education provides

low-level self- confidence and self - reliance to the women in the business

10. Isolated from Business Networks

Today, the business is transforming in different aspect, and maintaining the networks is

playing a vital role in the success of business. Apart from formal networks, the informal networks

maintenance demonstrates the success of business. It is necessary to attend the informal meeting s.

but the women entrepreneurs are considered as isolated from these kinds of business networks, which

dwindle the margin of women entrepreneurs

11. Negative Self-Perception

Women entrepreneurs will take a pioneering step in business to face the situations. But

because of not having proper support and positive attitude, majority of women are dropping their

ideas before the actual result.

12. Societal Problems

The society is sceptical about the abilities of the women entrepreneurs. The bankers consider

women business people as higher risk than men. The social pressure stops women from entering in

the field of entrepreneurship. Women are not allowed to take any type of risk even if she is willing to

take it and has the ability to bear it.

13. Cultural Problems

Women especially in India are known for culture. Most of the people feel that woman coming

out of home for work is not their culture. This limits the women mobility in starting a business

14. Inadequate Information and Data

The women entrepreneurs in sub-urban and rural areas are semi literates and they don‟t have

access to information in their own business and also the businesses which are booming. This will

curtail the profit margin.

15. Poor knowledge of latest technological changes

The literacy rate of women in India is found at low level compared to male population. Many

women in developing nations lack the education needed to spur successful entrepreneurship. They

are not that much of aware of the new technologies and often unable to do research and gain the

necessary training.

16. Lack of Interactions

Lack of interaction with successful entrepreneurs is also one of the problems in women

entrepreneurship in India. Successful entrepreneurs always play the role of model in the society for

women who have the ability of entrepreneurial activities. But unfortunately there is no sufficient

provision of such type of interaction to inculcate knowledge and provide experience of successful

women entrepreneurs.

17. Problems Associated with Middlemen.

Women entrepreneurs cannot travel very often because of family bonding and personal

problems. Hence, they depend on middlemen for the sake of promotion of sales and brand, who in

turn pocket the major share of profit

18. Marketing Problem

Women face a serious problem while marketing their products. The cost of advertisement is

too heavy for their stringent recourses. They are untrained when it comes to salesmanship and

marketing techniques.

19. Lack of Entrepreneurial Bent of Mind


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One of the biggest handicaps of Women entrepreneurs is the absence of entrepreneurial

preference or liking. This becomes a major impediment in their functioning as becoming an

entrepreneur is innovative risk bearing and vision

20. Lack of Special Training

First generation women entrepreneurs will be in need of special training as they lack previous

exposure to business. There is no proper and technical training to start a new venture. All women are

given the same training trough Entrepreneurial Development Programmes

Suggestions for the Development of Women Entrepreneurs The mainstream of Indian economy has always been the unorganised sector. Large numbers of

women in rural as well as urban areas have engaged themselves in self employed activities of unorganised

sector either as home worker or in any micro entrepreneurial activity to support the incomes of their families.

There is absence of proper basic facilities for their progress. Therefore, following efforts can be taken into

account for effective improvement and development of Women entrepreneurs

1. Consider women as specific target group for all developmental programmers

2. Better educational facilities and schemes should be extended to women folk from

Government part

3. Adequate training programme on Management skills to be provided to women

Community

4. Encourage women‟s participation in decision –making

5. Skill developments to be done in women‟s polytechnics and industrial training institutes. Skills are

put to work in training-cum-production workshops

6. Vocational training to be extended to women community that enables them to understand the

production process and production management

7. Training on professional competence and leadership skills to be extended to women entrepreneurs

8. Training and counselling on a large scale of existing Women entrepreneurs to remove

psychological causes like lack of self-confidence and fear of success

9. Counseling through the aid of committed NGOs, Psychologists, Managerial experts and technical

personnel should be provided to existing and emerging Women entrepreneurs

10. Activities in which women are trained should focus on their marketability and profitability

11. Making provision of marketing and sales assistance from government part

12. State Finance Corporations and Financing institutions should permit by statute to extend purely

trade related finance to Women entrepreneurs

13. Women‟s development corporations have to gain access to open ended financing

14. The financial institutions should provide more working capital assistance both for small scale

venture and large scale venture

15. Repeated gender sensitization programmers should be held to train financiers to treat women with

dignity and respect as persons in their own right

16. Infrastructure in the form of industrial plots and sheds, to set up industries is to be provided by

state run agencies

17. Industrial estates could also provide marketing outlets for the display and sale of products made

by state run agencies

18. Separate industrial estates may be set up exclusively for women entrepreneurs to reduce the

initial investment and to create a special environment.

19. The NGO‟s should conduct Entrepreneurial development programmes frequently, to motivate the

women in rural areas to start new innovation business

20. District Industries Centres (DICs) and other technology centres should take keen interest in

problems faced by unorganized sector and provide necessary facility for the development as provided to the

organized sector.


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21. Training in entrepreneurial attitudes should be started at high school level through well-designed

courses which may build confidence through behavioral games

22. Young graduates of that area and the final year students of U.G/P.G courses may also be

provided with such Entrepreneurship training

23. Broad Base Credit Linked Capital Subsidy Scheme (CLCSS) for Technology up gradation of

unorganised Enterprises plays an important role in supporting a women entrepreneur to raise required capital

and to achieve advancements in technology.

24. A women entrepreneur‟s Guidance cell set up to handle the various problems of women

entrepreneurs all over the state

25. Marketing product is one of the main problems for women entrepreneurs. Here, women co-

operative societies can be started to procure the products from women entrepreneurs. They will help them in

selling their products at a reasonable price.

26. Identify women with different literary levels in proper groups and to create awareness about

entrepreneurship and its importance as job providing avenues rather than job seeking ventures,

Conclusion Entrepreneurship among women, no doubt improves the wealth of the nation in general and of the

family in particular. Women today are more willing to start their own business or to take over family owned

business. The contribution of rural women to the economy is quite significant. Women entrepreneurs not

only give employment to greater number of people, they also enhance the economy to grow faster than

before, this results the women entrepreneurs to take challenging career and improve the nation as a whole.

But still, the problems and difficulties faced by rural women entrepreneurs are unnoticed. Lack of mobility

and capital investment was the major problem of rural entrepreneurs. Besides this, women entrepreneurs face

several obstacles. This is due to deeply rooted discriminatory socio-cultural values and traditions, embedded

particularly in the policy and legal environment and in institutional support mechanisms. In many instances

women are unable to benefit from services and struggle to overcome or circumvent discriminations in

business circles. So, it is the responsibility of the country to make certain policies to help the rural women to

develop entrepreneur skills and surface the problems to become flourishing entrepreneurs

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