Opinion | Women Entrepreneurs at the Heart of India’s Digital Economy: A Call for Progressive E-Commerce Policy

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In the ever-evolving landscape of India’s e-commerce story, women entrepreneurs can stand at the heart of a remarkable transformation. With its massive scale and profound impact, e-commerce has emerged as a game-changer, which can empower millions of women entrepreneurs across the country. As per a report by Bain & Company, India proudly boasts of being the third-largest online shopper base globally, a staggering 180-190 million strong in 2021, with projections to surpass the US and claim the second spot within the next two years.

Notably, women entrepreneurs are ready to seize this digital opportunity with great vigour. India has 63 million micro, small, and medium enterprises (MSMEs), of which around 20% are said to be women-owned, thus creating potential to employ 22 to 27 million people. Estimates suggest that by accelerating women’s entrepreneurship, India could create more than 30 million women-owned enterprises, potentially creating 150 to 170 million jobs. In the last five years, 83% of Indian small businesses have taken their businesses online, with 65% generating up to half of their revenue from online sales.

CHALLENGES AMID TRIUMPH

Despite the accomplishments of women entrepreneurs, they continue to face significant challenges in accessing loans to expand their businesses and overcoming structural, social, and economic barriers. India has ranked 57 among 65 countries in the Mastercard Index of Women Entrepreneurs (MIWE, 2021).

A 2022 survey by the Bharatiya Yuva Shakti Trust (BYST) revealed that over 85% of women entrepreneurs struggle to obtain loans, leading to an unmet credit gap of over $11.4 billion for women-led businesses.

Shockingly, women entrepreneurs receive a mere 5.2% of the total credit granted by Indian public sector banks, as reported by the International Finance Corporation (IFC), the private sector arm of the World Bank. Moreover, only 3.4% of women entrepreneurs benefit from the Indian government’s financial support schemes, according to the Institute for What Works to Advance Gender Equality (IWAAGE).

THE ROLE OF E-COMMERCE AS A CATALYST FOR CHANGE

However, amid these challenges, e-commerce has emerged as a game-changer for women entrepreneurs. Embracing technology, particularly online selling, has opened up a world of possibilities for women to expand their businesses like never before. E-commerce platforms recognize the potential of women-led enterprises and actively empower them through dedicated programmes and support them, providing an inclusive space to showcase and sell their products with minimal charges or as part of CSR initiatives.

With e-commerce as their ally, women entrepreneurs can transcend boundaries, reach a broader audience, and unleash their full potential, impacting the business landscape. Moreover, the growth trajectory of India’s e-retail market is truly remarkable, as it now caters to almost all PIN codes in the country, uniting diverse regions, languages, and communities. With a diverse array of products from local and global manufacturers and brands, e-commerce fulfils the aspirations of millions. Notably, seller growth in India has surpassed e-retail growth, with a 35% annual increase in sellers during 2020-21 and 40% of new sellers emerging from tier-II or smaller cities.

This shift signifies a paradigm change in consumer behaviour, as individuals from tier 2 and tier 3 cities now embrace the convenience of online product comparison, digital payments, and hassle-free home-based returns. This momentous alteration in consumer behaviour has emerged as a catalyst for change, primarily with potential to benefit rural women entrepreneurs and women affiliated with self-help groups (SHGs). The impact can be profound, unleashing many new business opportunities, providing greater flexibility, and creating a surge in job prospects. It is a compelling testament to the empowering potential of e-commerce, propelling women towards a future brimming with possibilities.

BALANCING LIABILITY AND GROWTH: AN URGENT CONCERN REQUIRING ATTENTION IN THE E- COMMERCE POLICY

As India sets its sights on becoming a $5-trillion economy, it recognises that supporting the MSME sector’s digital transformation, especially those led by women, is vital. The so- called vision of ‘women-led development’ can place women at the forefront of India’s progress. Gone are the days of women merely receiving the fruits of development; they can now wield the power to shape India’s growth story. E-commerce is proving to be the catalyst for unleashing the immense potential of women entrepreneurs, providing them with an expansive online customer base and unprecedented business opportunities.

Yet, amid the proclaimed success, the looming e-commerce policy discussions raise concerns. If not crafted thoughtfully, they could hamper the overall growth of the MSMEs and adversely impact women entrepreneurs.

Creating a thriving e-commerce environment hinge on ensuring fairness between online and offline sellers and alleviating the burden of excessive regulations. The implementation of stringent liability measures for e-commerce platforms might dissuade smaller businesses from entering the e-commerce realm, largely due to apprehensions about legal repercussions. This could potentially suppress the dynamic entrepreneurial spirit that has been flourishing within this industry. Furthermore, the introduction of fallback liability could establish obstacles for newcomers and lesser-known participants in the e-commerce sector. The requirement to adhere to rigorous liability standards could necessitate significant investments in quality control and customer service, potentially placing startups and MSMEs at a disadvantage compared to more established and larger counterparts.

Considering these discussions, it is imperative to acknowledge the multifaceted landscape of women-led businesses. Excessive regulatory burden should be avoided to ensure their unhindered growth. Policy formulation should be attuned to the contributions made by e-commerce entities and the indispensable services rendered to the sector by diverse MSMEs and startups.