Context: 

Recently, NITI Aayog launched the report titled “From Borrowers to Builders: Women’s Role in India’s Financial Growth Story,”.

More on the News

• The report launched by CEO NITI Aayog, Shri B.V.R. Subrahmanyam reveals that more women in India are seeking credit and actively monitoring their credit scores.
• The report, published by TransUnion CIBIL in collaboration with NITI Aayog’s Women Entrepreneurship Platform (WEP) and Micro Save Consulting (MSC).
• It showcases their growing awareness of credit scores and increasing credit-seeking behavior, signalling a positive trend towards economic empowerment.

Key Highlights of the Report

• As of December 2024, 27 million women were actively monitoring their credit scores, reflecting a 42% rise from the previous year. 

• This growth is indicative of women’s growing financial literacy and an increasing desire for financial inclusion.

• A notable trend in the report is the higher percentage of women from non-metro regions who are actively monitoring their credit. 

• Non-Metro regions saw a 48% increase in self-monitoring women compared to 30% in metro areas. 
• In 2024, Maharashtra, Tamil Nadu, Karnataka, Uttar Pradesh and Telangana accounted for 49% of all self-monitoring women, with the southern region leading at 10.2 million. 
• Northern and central states, including Rajasthan, Uttar Pradesh, and Madhya Pradesh, saw the highest Compounded Annual Growth Rates (CAGR) in active women borrowers over the past five years.

• Women’s share of the total self-monitoring base increased to 19.43% in December 2024, up from 17.89% in 2023.

• The report highlights that women’s participation in business loan origination has grown by 14% since 2019, and their share in gold loans has risen by 6%. 

• By December 2024, women accounted for 35% of business borrowers, which demonstrates a shift towards entrepreneurial ventures. 
• This growth is crucial for generating employment opportunities, with women entrepreneurship potentially creating jobs for 150 to 170 million people, contributing significantly to India’s economic development.

• Despite positive trends, challenges such as credit aversion, poor banking experiences, and issues related to collateral and guarantors persist. 

• These barriers hinder women’s full participation in the financial sector. 

• According to the report, credit awareness and improved credit scores are rising, and financial institutions have the opportunity to offer gender-smart financial products tailored to women’s unique needs.

About the NITI Aayog (National Institution for Transforming India) 

• On January 1, 2015, the NITI Aayog was established as the successor to the Planning Commission, created by an executive resolution from the Government of India (Union Cabinet).
• It is a non-constitutional (not created by the Constitution) and non-statutory (not created by an Act of Parliament) body.

Role and Function of NITI Aayog: 

• NITI Aayog serves as the premier policy think tank of the Government of India, providing both directional and policy inputs.
• NITI Aayog is responsible for designing strategic and long-term policies and programs for the Government of India.
• It also provides technical advice to both the Centre and States.
• The one-way flow of policy from the Centre to States, characteristic of the Planning Commission era, is being replaced with a genuine partnership between the Centre and States.
• NITI Aayog encourages a collaborative approach, as opposed to the command-and-control method of the past.
• In line with the spirit of federalism, NITI Aayog operates on a bottom-up approach, shaping its policy thinking by considering inputs from various stakeholders, rather than the traditional top-down model.

The NITI Aayog Composition:

1. Chairperson: The Prime Minister of India.

2. Governing Council: Includes Chief Ministers of all States, Chief Ministers of Union Territories with legislatures, and Lt. Governors of other Union Territories.

3. Regional Councils: Formed to address issues affecting multiple states/regions, convened by the Prime Minister, chaired by the Chairperson or their nominee.

4. Special Invitees: Experts and specialists nominated by the Prime Minister.

5. Full-time Organisational Framework:

• Vice-Chairperson: Appointed by the Prime Minister, with Cabinet Minister rank.
• Full-time Members: Hold the rank of Minister of State.
• Part-time members, ex-officio members, chief executive officer and secretariat.