Half of female entrepreneurs have been turned down for a loan to fund their new business – putting pressure on the Government’s ambitions to boost Britain’s economy, according to new research.
ome women business owners called out being viewed as “part-timers” because they have children or perceived as less serious professionals than their male counterparts.
Some 53% of women across the UK admitted that having limited access to finance has made it challenging to start their own firms, financial platform Tide found in a survey of its members.
Being shut out from accessing funding or a loan was seen as the biggest barrier to successfully launching a business.
We can be seen as part-timers, fitting work in around our children, But, we’re working hard to challenge these misconceptionsSamantha Senior, founder of The Aesthetics Accountant
The challenges were even more pronounced for black women, with more than two thirds of black female business owners finding the process challenging.
It compares to just under half of white and Indian women who said so, exposing the additional barriers that some women from ethnic minorities face.
The report also pointed at regional divisions, with businesswomen in Yorkshire and Humber and Scotland struggling more than any other region to access finance.
Across the UK, half of women entrepreneurs applying for a loan or investment to fund their new business are rejected, according to the survey.
Samantha Senior, the founder of an accountancy firm for the medical aesthetics industry called The Aesthetic Accountants, said she struggled to access finance as a self-employed mother, and after taking a hit during Covid.
She also highlighted coming up against “traditional” views in the male-dominated accountancy industry.
She said: “Myself and other female accountants have noticed we still come up against traditional views on occasion that accountancy is a male-dominated industry.
“The perception of some established male accountants is that women professionals take the industry less seriously than their male counterparts.
“We can be seen as part-timers, fitting work in around our children, But, we’re working hard to challenge these misconceptions.”
The findings come despite the Government striving to stimulate economic growth and boost business investment at a time that the economy is flatlining.
The UK narrowly avoided a recession in the last three months of 2022, with gross domestic product (GDP) eking up by just 0.01% over the quarter.
Nevertheless, numerous financial companies have pledged to help improve women entrepreneur’s chance of success when it comes to accessing critical funding.
Some 190 financial services institutions have signed the Investing in Women Code, which formally commits the firms to promoting female-founded businesses.
Big lenders like NatWest, Lloyds Bank, Barclays and Santander are all members of the code.
And a recent progress report by the Rose Review – an independent review of female entrepreneurship led by Dame Alison Rose, the boss of NatWest Group – found that more women than ever launched companies in 2022.
The data showed that 150,000 new companies were founded during the year, more than ever before and more than twice as many created in 2018.
Furthermore, Tide said it worked with more than 100,000 female-led businesses to help them start out.