Women’s Entrepreneurial Progress and Empowerment: An Evaluation of Microfinance Schemes in Pakistan

Abstract

Objective: The main objective of the study is twofold; first to identify the reasons why women entrepreneur is unable to progress despite taking microfinance loans from MFIs and second is to examine the relationship between their progress and empowerment.

Research Gap: Existing studies largely rely on single-dimensional measures or descriptive approaches, with limited use of composite indices and advanced econometric techniques to capture the multidimensional nature of women’s empowerment and its linkage with entrepreneurial progress.

Design/Methodology/Approach: Principle of Proportion allocation is used to obtain representative sample.  A complete sample of 900 women is evaluated with the help of both descriptive and econometric techniques using SPSS and SMART PLS softwares. Two indices i.e.  progress index & empowerment index were developed and Partial least Square and Structural Equation Modelling (SEM) are used for finding the intensity of each factor on the progress and empowerment indices.

The Main Findings: Findings showed that all kinds of three factors (Environmental/Social and technical) are positively contributing to the progress of women however the impact of their social factors is much higher than the other two. Moreover progress is also having positive and highly significant relationship with empowerment with path co-efficient of 0.90. However the large proportion of progressed and empowered women is found to be in rural areas.

Theoretical / Practical Implications of the Findings: The findings suggest that strengthening access to finance, social support systems, and institutional facilitation can significantly enhance women’s entrepreneurial progress and, in turn, improve empowerment outcomes.

Originality/Value: The development of Progress index and empowerment index is the novelty of this study. So far to our knowledge, there is no evidence of such kind of extensive field survey targeting the women borrowers for their own businesses.