Analysis: Information Asymmetry Is Keeping Rural Women Entrepreneurs From Success
By Vidya Shah
Farida, a 36-year-old widow lives in a small village in Kutch, Gujarat, with two daughters. She feeds her family by growing vegetables in her kitchen garden and supports them financially by working as household help in nearby homes. To supplement her income, she opened a small retail shop to sell groceries. However, with growing competition in her community, Farida’s customer base began to dwindle, making it increasingly hard for her to sustain her enterprise, eventually forcing her to shut shop.
Without capital to procure products for sale resulting in unstable cash flows, Farida could not continue her business, even though she had the requisites to apply for financial aid, i.e. an Aadhaar card and PAN card, as well as RSBY (Rashtriya Swasthya Bima Yojana) health insurance and a savings account. She did not wish to opt for a government entitlement—tailored to the needs of women like her—because she felt unsure of her ability to repay the loan and was unaware of the modalities for the same.
Photo courtesy of Meena Kadri.