Financing Women: How Gender-Disaggregated Data Can Power India’s Growth

As India charts its course through Amrit Kaal towards its ‘Viksit Bharat’ (Developed India) 2047 vision, a central economic imperative has emerged: unlocking productive capital for all. This national ambition hinges on empowering millions of women entrepreneurs and bringing them into the formal credit ecosystem. However, a critical blind spot persists. The financial systems meant to deploy this capital often operate with incomplete data, leaving them unable to accurately see, serve, and support a vast and creditworthy segment of the population.

To achieve this leap in economic growth, a more inclusive and precise financial policy is not just desirable but essential. This is where Gender-Disaggregated Data (GDD) becomes a strategic instrument of national importance. It provides the lens needed to direct capital efficiently, transforming a systemic blind spot into a powerful engine for equitable growth and ensuring the Viksit Bharat mission is built on a foundation of true financial inclusion.

Data-Driven Insights, Proven Returns

The case for using GDD to channel productive capital is proven by global financial performance. A multi-year survey by the International Finance Corporation (IFC) provides a powerful result: banks that lend to women-owned small and medium enterprises (SMEs) consistently experience lower Non-Performing Assets (NPAs) from that portfolio compared to their overall SME portfolio. This demonstrates that women, as a customer segment, represent a lower credit risk and a prime opportunity for productive investment.

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This superior performance is not an anomaly. It reveals a fundamental flaw in traditional credit models that do not use a gender lens. Deeper analysis has shown how standard algorithms can systematically misclassify creditworthy women as high-risk. A study in the Dominican Republic, for example, found that a gender-intentional model would have qualified over a third of previously rejected women. For India to effectively deploy productive capital, it must first fix the biased mechanisms that currently misdirect it.

The systematic use of GDD offers clear evidence that advancing women’s financial inclusion strengthens institutional performance. As a result of data-driven adjustments, the gender gap in SME loan sizes declined from 28 per cent at the beginning of the investment period to just 4 per cent in 2024. Moreover, the data showed that a higher share of women clients is positively associated with stronger portfolio quality, revenue growth, and return on equity. Institutions that also expand the hiring of women loan officers are able to reach and retain more women clients.

India's Call to Action: Mandate, Measure, and Mobilize

To align India’s financial system with its national goals, a series of bold, data-driven actions is required. Instead of a single score, the call is for a systemic shift in how data is used to drive policy and performance.

1. Mandate Granular GDD Reporting: The Reserve Bank of India (RBI) and other regulatory bodies can lead by mandating all regulated financial institutions to collect, analyze, and report key gender-disaggregated metrics. This should go beyond account ownership to include data on loan applications vs. disbursals, average ticket size, sectoral lending, and portfolio quality for women customers. This creates a national dataset that makes the women's market visible.

2. Measure the True Gender Impact of National Schemes: Flagship programs like MUDRA and Stand-Up India are designed to foster entrepreneurship. Their success should be measured through a mandatory GDD lens. Public-facing dashboards could track not just the volume of loans to women, but their value, the sectors they are in, and their repayment performance. This ensures these historic initiatives are creating genuine economic empowerment, not just meeting quotas.

3. Mobilize Capital Through Data-Driven Product Design: GDD insights should be used to actively de-risk lending to women and design targeted financial products. This includes creating tailored credit guarantee schemes for sectors with high female participation or using GDD as a basis for fintechs to build new, more inclusive underwriting models. The data should not just be collected; it must be used to innovate and mobilize capital where it is most needed.

4. Create India’s Gender Intentionality Score: GIS could be a tool to aggregate 30+ gender-disaggregated indicators into a composite score to benchmark progress, identify gaps, and improve women’s access to and usage of financial services. By making gender data visible, actionable, and comparable, the score can propel financial institutions to align gender inclusion with business growth. For example, early warning systems using credit utilization, repayment patterns, and financial behavior indicators can flag potential NPAs and help design proactive engagement strategies among lenders. 

The Economic Cost of Inaction

The failure to act on GDD is not just a missed opportunity; it actively hinders India's development goals. Globally, the credit gap for women-led MSMEs is estimated at $1.7 trillion. This is not a debt to be serviced but a massive market opportunity waiting to be unlocked. By leaving this capital on the table, we are slowing our own progress towards becoming a developed economy.

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Conversely, the business case for action is undeniable. Data from the Global Banking Alliance for Women shows that institutions focusing on the women's market experience higher returns on equity and lower risk. For India, every rupee of credit that flows to a woman entrepreneur based on accurate data is a high-return investment in job creation, community stability, and national growth.

Building the Business Case for a Developed India

Ultimately, embedding GDD into India's financial architecture is not a technical exercise—it's a strategic necessity for achieving the Viksit Bharat vision. It requires collaboration between regulators who set the standards and financial institutions who build the internal capabilities to act on the insights.

As India evolves, so must the metrics by which we measure success. Profitability and inclusion are two sides of the same coin, and GDD is the tool that connects them. The business case is clear, and the national mandate is urgent. The time has come to act, not just for equity, but for the pursuit of a smarter, stronger, and truly developed India.

Kalpana Ajayan is Regional Head, South Asia, and Dr Sambit Rath is Research Lead, South Asia at Women’s World Banking