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Lending Bias: The Unseen Gender Credit Gap and Its Implication

The gender credit gap has persistently loomed over India's financial landscape, sidelining women entrepreneurs and borrowers from the financial ecosystem.

Despite their significant contributions to the economy, women have remained largely underserved by traditional financial institutions.

This article dives into the gender credit gap in India, exploring its determinants, the hurdles in bridging this gap, and how Rang De offers a promising solution by enabling peer-to-peer lending to women entrepreneurs, artisans and farmers.

The Gender Credit Gap

The gender credit gap in India is stark. A 2020 study pointed out that women in India receive credit equal to only 27% of the deposits they contribute, while men receive credit equivalent to 52% of their deposits​​.

According to a 2022 IFC report, approximately 90 percent of women entrepreneurs in India have not borrowed from a formal financial institution.

Determinants and Challenges of Credit Gap

Several factors contribute to the gender credit gap. Socio-cultural barriers, the burden of unpaid care work, lack of collateral, and biased lending practices by formal financial institutions are among the chief obstacles women face. The lack of supportive conditions for entrepreneurship has consistently let down women entrepreneurs.

Despite improvements in women’s access to bank accounts, the financial inclusion policy has emphasised deposits over access to credit, further widening the credit gap​​.

A Step towards Bridging the Credit Gap

Addressing the gender credit gap requires a multi-pronged approach. Initiatives like the Pradhan Mantri Mudra Yojana and Stand Up India have made strides in supporting women entrepreneurs. However, the journey towards gender financial inclusion is far from over.

Rang De is bridging the financial inclusion gap. By connecting borrowers directly with Social Investors, Rang De eliminates the need for intermediaries, making credit more accessible and affordable.

74% of the borrowers funded at the Rang De Platforms are women with a staggering 42 crores invested in businesses run by women entrepreneurs.

The gender credit gap is not just a number; it's a reflection of the unmet potential of women entrepreneurs in India. By participating in peer-to-peer lending through Rang De, you are not merely lending; you are fostering a culture of financial inclusivity and empowering women entrepreneurs to thrive.

How Rang De Addresses the Credit Gap

At Rang De, we believe in a personalised approach to credit, tailored to meet the unique needs and circumstances of each individual, especially women who have traditionally been sidelined in the financial narrative.

Our commitment goes beyond mere transactions; it's about building a foundation for financial literacy, empowering women with the knowledge and tools they need to navigate the economic landscape confidently.

We hold hands with first-time borrowers, nurturing a culture of trust and understanding that eases their journey into the financial realm. This human-led approach is our hallmark, setting us apart in a sector often blinded by figures and devoid of personal touch.

By fostering a community of informed, confident women borrowers, we are not just facilitating credit access but are contributing to a broader narrative of financial inclusivity and empowerment.

Embark on this journey of impact by exploring lending options through Rang De and be a part of the solution to bridge the gender credit gap in India.

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Meenal Mamdani
Meenal Mamdani
Oct 19, 2023

Dear Mr Seemon

Another excellent post for saving for future use as it has so many urls leading to more information about this subject.

This gender gap exists in all countries including the wealthy Western countries, only the percentages are less.


Leslin K Seemon
Leslin K Seemon
Oct 19, 2023
Replying to

Thank you Meenal Ji for taking the time to read the post and share your insightful observations. You're absolutely right, the gender credit gap is indeed a global issue, transcending geographical and economic boundaries.

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