Financial empowerment for women is essential, these initiatives can be real empowering.

(Sanjit Davar)

Women are getting empowered with the changing times. They are now reaching high positions in large enterprises and corporate organizations. Women play an important role in financial planning and ensuring the financial strength of the household. If women are assured of easy access to credit, they will not only be financially empowered but it will also help in financial inclusion. Over the past few years, loans have greatly helped women’s entrepreneurship flourish.

There is a constant increase in the number of women who are taking loans to achieve their goals in life. This is clearly seen in the report published by Crif Hi Mark on the occasion of International Women’s Day. The share of women in the outstanding portfolio of retail loans has fallen to 25 percent. This number has increased from Rs 20.7 lakh crore by December 2021 to Rs 26 lakh crore by December 2022. The share of young women borrowers aged 35 and below has increased from 38.3 percent in the last 3 calendar years to 43.4 percent in 2022.

Let’s find out what women need to focus on, so that they can easily get loans in the future and enjoy the benefits of real empowerment…

Prioritize your goals, budget and savings.

Start by setting financial goals. However, timelines may vary and change depending on your preferences for the short term, medium term and long term. Short-term goals can include setting a budget, saving for an emergency fund, paying rent, buying insurance, paying off student loans or credit cards, traveling, getting married, etc. Medium-term goals include buying a home, saving for a down payment on a car, and paying off debt. Saving for retirement, paying off a mortgage, starting a business, and saving for a child’s education all fall into the category of long-term goals.

Build wealth through diversification of debt and equity investments.

Depending on age and risk appetite, consider diversifying investments across different asset classes to minimize risk of loss and maximize returns. You should also look for investment opportunities designed for women, which offer higher interest rates to women, such as FDs and government schemes for women.

Institutional access to credit

Today, due to government initiatives, women entrepreneurs have easy and quick access to formal credit, increasing credit access and affordability. These schemes are specifically for women, with benefits such as low interest rates, security-free loans, credit-linked capital subsidies and repayment flexibility.

Maintain a good credit score

There are a few things you need to do to maintain a good credit score, such as maintaining a good credit mix that includes both secured and unsecured loans. Maintain a balance between your credit limit and your credit costs. Make sure you don’t overuse your credit card. Pay dues on time. Don’t repeatedly inquire for a loan or card.

Protect your assets by insuring them.

Covering your property with insurance is a must. This can include purchasing health insurance, life insurance, auto insurance, and property insurance to protect against unexpected events that could have a significant financial impact. By protecting assets through insurance, women can ensure that their financial portfolio remains protected despite unexpected challenges.

(The author is the Managing Director of Crif Hi Mark, the views expressed are his own.)

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