Women Finding More Financing, Still Lag Men

More female entrepreneurs are obtaining financing to operate and expand their businesses. But they still have less bank credit than their male counterparts, while minority women continue to struggle to access capital.

Those are some of the findings in a just-released survey that shows female entrepreneurs increasingly are getting the credit they deserve from the nation’s banks.

The study by the National Foundation for Women Business Owners (NFWBO) showed that 52% of female entrepreneurs surveyed possessed some sort of bank credit in July 1998. That’s up from 46% in 1996 when the survey was last conducted. NFWBO began tracking business financing trends for women-owned businesses in 1992.

The latest findings reflect the growth and maturity of women-owned businesses, which historically have tended to rely more on personal savings and other non-bank sources than their male-owned counterparts, according to NFWBO spokesman Bruce Rosenthal.

“Women-owned firms are becoming much more sophisticated in the way they approach financial institutions,” Rosenthal said. “Banks also have recognized them as a profitable, fast-growing market.”

Still, women trail their men-owned counterparts when it comes to obtaining bank financing. Nearly 60% of male entrepreneurs surveyed said they had access to bank credit--and they qualified for bigger loans. About 16% of men surveyed said they had access to $500,000 or more in bank credit, compared with just 7% of women.

Women of color were much less likely to have access to bank financing than white women. Only 29% of minority female business owners said they had access to bank credit, while more than half said access to financing was an important concern.