By Blossom Ukoha
A woman can build a profitable business, attract loyal customers and create jobs, yet still struggle to take that business to the next level. The challenge is often not a lack of ambition. It is a combination of financial, structural, social and institutional barriers that make scaling harder.
From Lagos to London, Nairobi to New York, women entrepreneurs are building businesses across industries. Yet the International Finance Corporation (IFC) estimates that women-owned small and medium-sized enterprises in developing markets face a financing gap of roughly $1.5 trillion.
Scaling requires more than starting capital. It requires access to markets, networks, technology, skills, assets and systems that allow a business to move from survival to sustained growth.
Here are eight major hindrances.
1. Limited Access to Finance
Capital is one of the most persistent barriers.
According to the IFC, women-owned businesses face an estimated $1.4–$1.7 trillion credit gap. Women often rely heavily on personal savings, family resources and other informal financing, which may be sufficient to start a business but rarely enough to finance rapid expansion.
Scaling may require new equipment, employees, inventory, technology, marketing or entry into another market. Without appropriate debt or equity financing, many businesses remain small.
2. The Collateral and Asset Gap
Access to finance is also connected to ownership of assets.
Banks commonly require collateral for business loans, but women may have less access to titled land, property and other assets that can be used as security. The IFC identifies access to capital and assets among the significant barriers facing women-owned businesses.
Where property and inheritance systems disadvantage women, the consequences can reach directly into entrepreneurship: without assets, borrowing becomes harder; without borrowing, expansion becomes harder.
3. Being Concentrated in Lower-Growth Sectors
Women-owned businesses are often concentrated in areas such as retail, personal services, hospitality, education and care.
These sectors can be profitable, but many businesses within them operate with smaller margins and limited opportunities for rapid productivity growth compared with capital-intensive industries, technology and some high-value business services.
This does not mean women lack ambition. Rather, it reflects the opportunities, capital and networks available to them.
Moving into higher-growth sectors requires access to finance, technical skills, markets and professional networks—precisely the resources women entrepreneurs may find hardest to obtain.
4. Limited Access to High-Value Networks and Markets
Growth rarely happens alone.
According to the OECD, business networks help entrepreneurs access finance, advice, suppliers, customers, employees, partnerships and new ideas. Yet women entrepreneurs typically have smaller and less developed business networks than men.
This can limit access to corporate supply chains, government procurement, export opportunities and strategic partnerships.
A woman may have an excellent product, but without the right introduction, contract or distribution network, her business may never reach the customers capable of taking it to the next level.
5. Skills and Digital Gaps
Running a small business and managing a growing company require different capabilities.
As a business expands, the founder must understand financial statements, cash flow, hiring, delegation, governance, digital tools, procurement, marketing and investment readiness.
The OECD’s recent work on financing women entrepreneurs highlights the importance of financial skills, investor readiness, equity financing and fintech solutions in helping women-owned businesses progress through different stages of growth.
Digital transformation makes this even more important. Businesses increasingly need technology for payments, customer management, marketing, data analysis and access to international markets.
6. Care Responsibilities and Time Poverty
For many women, the business day does not end when customers leave.
Women continue to shoulder a disproportionate share of unpaid care and domestic responsibilities. The ILO has identified care policies and childcare services as important components of women’s entrepreneurship development because care responsibilities can limit women’s ability to participate fully in business and growth opportunities.
The problem is particularly significant when scaling requires travel, networking, training, longer working hours or relocation.
Time is a business resource. When a founder has little control over her time, growth can become considerably more difficult.
7. Bias, Social Norms and Investor Perceptions
Women entrepreneurs may also encounter assumptions about what kind of businesses they should operate and how ambitious they should be.
Bias can influence how investors, lenders, suppliers and potential partners assess risk, leadership and growth potential.
This matters particularly in sectors traditionally dominated by men, where women may have to overcome assumptions before their business model is even evaluated.
The IFC notes that women entrepreneurs face barriers not only to capital but also to markets and broader participation in financial systems.
Changing the numbers therefore requires changing perceptions as well.
8. Legal, Regulatory and Institutional Barriers
Sometimes the barrier is embedded in the business environment itself.
The World Bank’s Women, Business and the Law 2024 report found that women globally had, on average, only 64% of the legal protections enjoyed by men when factors such as safety and childcare were included. It also found that countries had established less than 40% of the systems needed to fully implement the laws supporting women’s economic equality.
Registration, licensing, taxation and formalisation can also create additional costs for small businesses.
In Nigeria, for example, an ILO study of women entrepreneurs in Lagos and Rivers found that many participants combined business activities with unpaid domestic and childcare responsibilities, while one in three respondents from Lagos said they had needed their husband’s consent before starting a business.
These barriers can discourage formalisation and limit access to larger contracts and financial services.
From Starting Businesses to Scaling Them
These obstacles rarely occur independently.
Limited capital can keep a business informal. Informality can restrict access to larger markets. Limited networks can reduce access to finance. Care responsibilities can reduce the time available to build those networks. Skills gaps can make it harder to attract investment.
It becomes a cycle.
Breaking that cycle therefore requires more than telling women to “work harder.”
The IFC’s Women Entrepreneurs Finance Initiative (We-Fi), for example, combines financing with entrepreneurship ecosystems, mentoring, peer networks, technology and market access, reflecting the reality that women-owned businesses need more than one intervention to scale.
A Call to Action
Governments can simplify business regulations, strengthen women’s property and economic rights, improve childcare and expand access to public procurement.
Financial institutions and investors can design financing products that reflect the realities of women-owned businesses and expand access to growth capital.
Corporations can open supply chains and procurement opportunities to women-owned enterprises.
Business networks and mentors can connect women entrepreneurs to markets, expertise and strategic partnerships.
And women entrepreneurs should be supported not only to start businesses, but to build companies capable of employing people, entering new markets, attracting investment and creating lasting economic value.
Women are already building businesses.
The next challenge is ensuring that those businesses are given the capital, markets, networks, skills and enabling systems required to scale.
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