Investing in Women data collection

The Alison Rose Review of Female Entrepreneurship, published in March 2019, highlighted that up to £250 billion of new value could be added to the UK economy if women started and scaled up new businesses at the same rate as men. The Review's recommendations included the need to promote greater transparency in UK funding allocation through a new Investing in Women Code. Signatories to the Code made a commitment both to supporting female entrepreneurship and to collecting data to enable a better understanding of entrepreneurial gender parity.  

UK Finance gathered data for Q2 2020 covering the provision of all types of lending products to businesses, including overdrafts, commercial loans and government guaranteed loans. We received responses from lenders covering approximately 60 per cent of the business lending sector in the UK and based on the 76 per cent of records that could clearly be identified by gender.

The beginning of Q2 2020 coincided with the start of the first national Covid-19 lockdown, which resulted in many businesses being required to suspend trading. In response, the government introduced a package of support for businesses including government guaranteed loans such as the Coronavirus Business Interruption Loan Scheme (CBILS) and the Bounce Back Loan Scheme (BBLS). This resulted in a large number of applications for loans by businesses that would not usually use external finance.   

Analysis of this data reveals that women-led businesses (WLB) are as likely as male-led businesses (MLB) to receive the finance they need to start up, invest and grow. However, there are disparities between WLBs and MLBs in terms of the overall number of applications made and the amount of finance applied for. WLBs are both less likely to apply for finance and more likely to apply for a lower amount of finance than MLBs. 

These findings are in line with other independent research on women-led businesses. A report by BVA BDRC in February 2020, Women Led Businesses YEQ2 2019, found that 22 per cent of all SMEs are led by women. They have a similar size and risk profile to those led by men but are more likely to be found in the health or other community sectors and less likely to have been trading for ten years or more. WLBs are less likely to be using external finance or trade credit, or to have more than £5,000 of credit balances, and are attitudinally more reluctant to borrow. They are also slightly less likely to meet the definition of an ?Ambitious Risk Taker?.

More detail about this data is available in the Treasury's report, The Annual Investing in Women Code Report.

These findings reinforce the value of the work that many lenders do in providing advice and support to WLBs at all stages of their entrepreneurial journey including at start-up. The recently launched Invest in Women hub provides a wide range of advice and resources for female entrepreneurs at every stage of their business journey.

UK Finance and our members remain committed to supporting female entrepreneurs. Our work to gather the data, understand the challenges women face in chasing their entrepreneurial dreams and to address these issues continues.

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