Four in 10 female business leaders lack cashflow needed to grow, data reveals

Women-owned small and medium sized enterprises (SME) are more likely to suffer cashflow challenges than their male counterparts, new research from Bibby Financial Services (BFS) has found.

Only half (49%) of women business owners reported that their cashflow was stable and met their needs, compared with a significantly higher two-thirds (66%) of male respondents.

Four in 10 (43%) female business leaders say they did not have the cashflow they needed to grow, compared with 29% of their male peers – highlighting a 14% gap.

Nearly half (48%) of female business leaders surveyed were worried about not being able to pay back loans if interest rates rose further, compared with just under a third (32%) of men.

Lucile Flamand (pictured), chief strategic development officer of BFS, said: “An uneven playing field of institutional barriers and entrenched stigmas have significant impact on female led businesses, and so it is entirely unsurprising that this is reflected in a confidence gap between women and men.

“The ugly truth is that, even in 2023, it’s still much harder for female entrepreneurs to access funding than it is for their male peers.

“In fact, women business owners receive less than half of the investment capital of their male counterparts, despite delivering twice as much revenue per dollar invested.”

The 2023 Alison Rose Review of Female Entrepreneurship saw 50% of female business leaders report finding access to funding and investment hard in the past 12 months, compared with 40% of their male equivalents.

This aligned with BFS’ research, as 62% of female SME leaders said it was harder to secure a business loan now than pre-pandemic, compared with 57% of male business leaders.

Lucile Flamand added: “These stats serve as a stark reminder of the work that still needs to be done, but female entrepreneurs remain motivated and determined, highlighted by the fact that last year a record 150,000 new firms were founded by women in the UK.

“Women business owners have so much potential to bring new ideas and exciting businesses into the world.

“So, now, it is more important than ever to make sure that we keep fighting the good fight – recognising both the opportunities and challenges for women-owned businesses, and ensuring that access to finance is not one of them.”