Empowering women entrepreneurs: Navigating challenges and seizing opportunities for gender intentional programs

This post is part of a series on our findings from Strive Community’s Small Business Digital Evidence Map. The Evidence Map, developed by Caribou Digital, is the first interactive public tool charting evidence on the impact of digital and data-first interventions on small businesses. To learn more about the Evidence Map, visit the website and read our introductory post.

In the ever-evolving digital landscape, small, women-owned businesses often struggle to adapt to and take advantage of digital opportunities. Take the story of Le Hong Van, owner of Joy VN, a small Vietnamese business specializing in high-quality rice products. During the pandemic, Le Hong struggled to adopt e-commerce due to her focus on quality over price, which was difficult to express online. Instead of making compromises on price, she completed e-commerce and digital marketing courses provided by Strive Community’s partner WISE. Using what she learned, Le Hong transformed her business. She established a sustainable digital presence on the e-commerce platform Shopee and improved the quality of her marketing content; she is now seeing the proportion of revenue generated from e-commerce increase.

Women face unique challenges, opportunities, and experiences as small business owners. Understanding these differences is crucial to creating an inclusive and supportive environment that empowers them to thrive as small business owners.

To support women like Le Hong, and the recently launched Strive Women program, our team turned to our Small Business Evidence Map to explore the evidence on the impacts of digital and data-first interventions on women-owned small businesses. We uncovered real-world insights on how best to support women from 45 studies. This post outlines our three main takeaways.

Women-owned small businesses are digitalizing, but they have distinct needs and barriers.

The evidence suggests that women-owned small businesses are increasingly adopting digital tools, e-commerce, and digital financial services (DFS). Since the start of the COVID-19 pandemic, evidence from 11 studies indicates that women-owned small businesses are adopting so-called “low-stakes” digital tools — those with minimal financial or time commitments, for example, social media for marketing and sales and email — at a higher rate than male-owned businesses. For example, in Mexico women-owned businesses increased their use of digital tools by 14 percentage points during the pandemic, compared to 9 percentage points for men. However, the use of more complex and costly digital tools and services, including many DFS, is less common among women-owned small businesses.

The evidence also highlights that, compared to men, women small business owners tend to have lower financial and digital literacy levels, restricted access to formal financing options, and increased challenges balancing business and family responsibilities. Prevalent norms and, in some contexts, discriminatory regulations often contribute to these barriers.

Although most evidence points to barriers, support to address social and gender norms — for example, through CARE and Mastercard’s Ignite Program (a precursor to Strive Women) — has shown early signs of positive changes for women entrepreneurs.

To capitalize on momentum for digitalization, women need additional support to adopt more complex tools and platforms — including information management systems, digital lending products, and e-commerce platforms — which are linked to improved efficiency, resilience, and revenue growth for women-owned small businesses. Support that explicitly addresses women’s barriers to entry and advancement as business owners is needed to address the additional social constraints that women face.

Take a bundled approach to drive impact.

Siloed solutions lead to limited, short-term changes in capacities and practices. Bundling is a key differentiator of digital as it can more easily deliver support at the right time and in the right combination for small businesses. Two-thirds of the women-focused studies in the Evidence Map represent bundled support. These studies have shown that the combination of different elements of DFS, market access digital tools, and/or upskilling can lead to a positive impact on business revenue — with women-owned small businesses reporting an increase in revenue between 30% and 80% (16 studies).

Digital support programs should consider how to bundle their efforts to find the right combination of support for the needs and capacities of their small business audience.

Digital programs and services that are not gender-intentional can exacerbate existing gender gaps.

Organizations may view their services and programs as gender neutral. However, the evidence suggests that digital and data-first programs and services that are not gender-intentional can worsen inequality by failing to address the unique constraints faced by women.

Digital Financial Services (DFS): Women often are at a disadvantaged starting point and face higher barriers than men in terms of information about financial products and where to access support. DFS programs that are not tailored to these conditions can exacerbate these differences (3 studies), whereas programs that take a gender-intentional approach are more likely to reduce, or at least maintain, the existing gender gap between women- and men-owned small businesses’ adoption of DFS (7 studies). (Read more about DFS for women-owned businesses in our insight brief.)

Digital market access: Programs focused on digital market access rarely take a gender-intentional approach to increase women’s participation. As a result, women business owners are increasing their use of social marketplaces (7 studies), but they are less likely to participate in larger e-commerce platforms associated with greater revenue growth (3 studies). Women disproportionately report difficulties with e-commerce when identifying which channels to use and managing a digital presence across multiple channels and platforms. Women business owners also experience disparate challenges related to negative online feedback, the risk of stress and burnout, and maintaining work-life balance for online businesses. This is largely due to social norms and a greater proportion of time spent on unpaid domestic and care work.

Digital tools: Many digital tools and services fail to meet the needs of women-owned small businesses, resulting in lower levels of uptake — especially for more complex or costly digital tools. Where women do take up general business tools (e.g., office software, email or chat tools for supplier/customer engagement), they often have little effect on closing the gap between the performance of men- and women-owned businesses (10 studies). More advanced tools (including software for data analytics, logistics, financial management, and inventory management) contribute to positive impacts on work opportunities (4 studies) and increasing revenue (7 studies). However, women’s uptake of these platforms remains low. While gender-neutral approaches continue to perpetuate existing differences in the adoption and benefits of digital tools, there was no evidence found of programs that used a gender-intentional approach to tool adoption to understand the potential benefits.

Gender-neutral programming is not enough to close the gaps in digital product and tool adoption, nor the benefits that come from digital for small businesses. There are few good examples of gender-intentional programs for women-owned small businesses. Ignite has shown that working directly with financial and non-financial service providers can have positive results: by the program’s midline, an average of 58% of women reported higher resilience and 81% reported higher sales across three countries. More robust research in this area — particularly around gender-intentional approaches to small business tool adoption — would be a welcome addition to the evidence base.

Design digital solutions for women-owned small businesses to unlock their full potential.

The above insights show the importance of placing women’s needs at the center of digital support, tools, and services. Yet many approaches do not currently do so and thus miss the opportunity to empower women-owned businesses to grow. Stronger consideration of women, and evidence of what works for women, in the design of support and solutions will:

• Address the gender gaps in women’s uptake of solutions
• Increase the positive impacts women can reap from new products and solutions
• Open new markets for service providers to tap into

Building on the success of Ignite, Strive Women is an initiative from the Mastercard Center for Inclusive Growth and CARE focused on supporting female entrepreneurs. It will deliver a tailored suit of financial products, support services, and increased access to markets to improve the financial health of women-led micro and small enterprises. The program has been designed with considerations drawn from the Small Business Evidence Map by ensuring that interventions are gender-intentional and take a bundled approach to provide holistic solutions for women-owned businesses.

The studies in the Evidence Map represent our best knowledge of digital support for small business insights. New studies are continuously emerging and thus the Evidence Map will continue to evolve. If you have questions on the Evidence Map, are interested in discussing research priorities, or know of relevant digital support for small business impact studies, please contact hello@strivecommunity.org.