© Copyright Acquisition International 2024 - All Rights Reserved.

Article Image - Financing Gap For Female Entrepreneurs Widens By 78% Since The Rose Review in 2019
Posted 25th April 2024

Financing Gap For Female Entrepreneurs Widens By 78% Since The Rose Review in 2019

The financing gap between men and women for government-backed Start Up Loans has widened by 78% since the Alison Rose Review was published in 2019 - an independent review of female entrepreneurship in the UK commissioned by the Treasury.

Mouse Scroll AnimationScroll to keep reading

Let us help promote your business to a wider following.

Financing Gap For Female Entrepreneurs Widens By 78% Since The Rose Review in 2019
Side view of serious female economist working online with accounting documents on modern laptop device
  • The value of Start Up Loans to female entrepreneurs in 2023 was almost £30 million lower than the figure for male entrepreneurs.
  • The startup financing gap has widened by £13 million since 2019, when the Rose Review recommended funding to female entrepreneurs should increase.
  • The proportion of Start Up Loans granted to women has also dropped since 2019, but representation of women on FTSE 100 boards has increased by 10 percentage points.

The financing gap between men and women for government-backed Start Up Loans has widened by 78% since the Alison Rose Review was published in 2019 – an independent review of female entrepreneurship in the UK commissioned by the Treasury. 

The gap in the value of loans to male vs female entrepreneurs is now £13 million wider compared to 2019, according to new research by personal finance comparison site finder.com

This is despite one of the key recommendations of the Rose Review being that funding to female entrepreneurs should increase. The report highlighted that up to £250 billion of new value could be added to the UK economy if women started and scaled new businesses at the same rate as men.

Following the findings, the government announced an ambition to significantly increase the number of female entrepreneurs by 2030. However, analysis of data exclusively obtained from the British Business Bank found the value of Start Up Loans granted to female-led businesses in 2023 was £46.7 million, while the value of loans to male-led firms was £76.6 million, creating a gender disparity of £29.9 million. 

On paper, the value of loans granted to female entrepreneurs has increased since 2019, but it has not risen at the same rate as loans to men. The value of loans to male-led businesses increased by 44% in this period, rising from £53.3 million to £76.6 million, compared to an increase of just 28% for female-led businesses, rising from £36.5 million to £46.7 million.

The proportion of loans granted to female entrepreneurs has fallen since the Rose Review

As well as looking at total loan value, the analysis also reviewed the number of individual loans granted to men and women and found that only 2 in 5 Start Up Loans were granted to female-led businesses in 2023. 

While the actual number of Start Up Loans granted to women has increased slightly, from 3,557 in 2019 to 3,850 in 2023, the percentage of loans granted to women has decreased from 43% in 2019 to 40% in 2023. This is despite the government’s target of boosting female entrepreneurship in the UK.

Olenka Kacperczyk, Professor of Strategy and Entrepreneurship at the London Business School, explains how bias among lenders can impact women entrepreneurs:

“Investors and lenders systematically discount and overlook the potential of women founders to deliver returns. These biases persist even in carefully controlled experimental settings, as women founders receive less favourable evaluations and resource commitments than men when presenting the exact same startup pitch and credentials.”

But there are more women on FTSE 100 boards 

Over the same period, there has been a rise in women holding leadership positions at the UK’s largest companies. 42.6% of members on FTSE 100 boards were women in 2023, up from 32.4% in 2019. 

This suggests that progress towards gender parity is being made among the big hitters in the UK, while funding for new businesses in the form of Start Up Loans is still lagging behind, despite the recommendations in the Rose Review. 

Commenting on the findings, Michelle Stevens, business loans expert at the personal finance comparison site finder.com, said: 

Work is being done to improve representation at the highest level, as shown by the make-up of FTSE 100 boards, so why can’t the same be said for those wanting to launch or grow a small business in the UK?

I’d like to see funding for female-led startups growing at the same rate as for male-led startups. SMEs are the backbone of the UK economy, making up 99.9% of private sector companies and contributing 53% of turnover. Therefore, real progress requires funding support for female founders early on in their entrepreneurship journey, so they can help shape the future business landscape.”

The research was conducted alongside a white paper investigating access to funding for female entrepreneurs in the UK, featuring analysis from a range of experts.

To see the white paper in full, visit: https://www.finder.com/uk/business-loans#smereport

About Start Up Loans:

Start Up Loans are government-backed personal loans available to aspiring entrepreneurs looking to start or grow a business in the UK. They are granted by the British Business Bank, a government-owned but independently managed business development bank.

Methodology and sources:

Finder analysed data obtained from the British Business Bank on the number and value of Start Up Loans granted to male and female entrepreneurs from 2013 to 2023. Data on the percentage of women on FTSE 100 boards was taken from the FTSE Women Leaders reports. Data on SME contributions is taken from GOV UK business population estimates. 

Categories: Finance, News


You Might Also Like
Read Full PostRead - Eye Icon
Is Gold A Promising Retirement Investment?
Finance
13/02/2023Is Gold A Promising Retirement Investment?

Retirement investments are essential for your later days, especially when you can no longer generate regular income like you used to.

Read Full PostRead - Eye Icon
Designing the Future of International Transactions
Finance
11/10/2021Designing the Future of International Transactions

Providing for wholesale banks and large market players in the financial sector, Adhara’s effective and efficient platforms and systems are now being used by some of the largest businesses in the world. Promoting a new technological industry standard, this co

Read Full PostRead - Eye Icon
IBM Announces Planned Acquisition of Promontory to Transform Regulatory Compliance with Watson
M&A
30/09/2016IBM Announces Planned Acquisition of Promontory to Transform Regulatory Compliance with Watson

IBM today announced plans to acquire Promontory Financial Group, a global market-leading risk management and regulatory compliance consulting firm.

Read Full PostRead - Eye Icon
Stellex Capital, in Partnership With Communify, has Acquired Fincentric From S&P Global
M&A
16/08/2024Stellex Capital, in Partnership With Communify, has Acquired Fincentric From S&P Global

Communify, a Just Build It (JBI) company led by the former founders of InvestCloud, in partnership with Stellex Capital Management, will be combined with Fincentric (formerly known as Markit On Demand), a provider of digital experiences, curating financial dat

Read Full PostRead - Eye Icon
Ferro Enters into Agreement to Acquire Global Inorganic Pigments Manufacturer Nubiola
Finance
30/04/2015Ferro Enters into Agreement to Acquire Global Inorganic Pigments Manufacturer Nubiola

Ferro Corporation announced today that it has signed a definitive agreement with the shareholders of Barcelona-based Nubiola Pigmentos to acquire 100% of the equity of Nubiola, on a cash-free and debt-free basis, for €146 million.

Read Full PostRead - Eye Icon
Ingenious IP Lawyer
Legal
18/01/2021Ingenious IP Lawyer

The murky world of Intellectual Property is hotly contested, with many law firms handling portfolios on a client’s behalf. As we look once again to those lights of the legal profession, we turn to Santiago R. O’Conor, the Leading Intellectual Property Pros

Read Full PostRead - Eye Icon
Verizon Acquiring AOL for $4.4 Billion
M&A
13/05/2015Verizon Acquiring AOL for $4.4 Billion

Verizon has announced that it is purchasing AOL for $0.50 a share which works out at a massive $4.4 billion.

Read Full PostRead - Eye Icon
Grakon LLC Acquires BMAC Limited
M&A
11/10/2016Grakon LLC Acquires BMAC Limited

Grakon LLC, a global leader in the design and manufacture of custom LED interior and exterior lighting solutions

Read Full PostRead - Eye Icon
AI Can Transform Our Businesses – But Beware of the Legal Pitfalls
Innovation
01/09/2023AI Can Transform Our Businesses – But Beware of the Legal Pitfalls

With artificial intelligence (AI) now firmly part of our everyday lives, businesses harnessing the power of this rapidly advancing technology must consider the legal constraints involved. Ben Travers, specialist intellectual property and technology partner at



Our Trusted Brands

Acquisition International is a flagship brand of AI Global Media. AI Global Media is a B2B enterprise and are committed to creating engaging content allowing businesses to market their services to a larger global audience. We have 14 unique brands, each of which serves a specific industry or region. Each brand covers the latest news in its sector and publishes a digital magazine and newsletter which is read by a global audience.

Arrow