Abt Britain and the Kyiv School of Economics presented the study ” Needs of and Challenges Faced by Ukrainian Female Entrepreneurs in the Conditions of Full-Scale War ” as part of a public event held at the Kyiv School of Economics on January 30. The authors analysed the state of affairs, focusing on micro-enterprises and small and medium-sized enterprises (SMEs), and described the needs and challenges of Ukrainian female entrepreneurs, marginalised groups in particular.

The research was conducted in cooperation with the Ministry of Digital Transformation of Ukraine, the Ministry of Economy of Ukraine, and the Entrepreneurship and Export Promotion Office as part of the Good Governance Fund project “Business Revitalisation in Ukraine” funded by UK International Development. The project delivery partners are Abt Britain and Kyiv School of Economics.

“For a long time, the development of female entrepreneurship remained outside the routine attention of the state. However, nowadays, more women are ready to develop their own businesses and take proper risks. Our task as experts is to discover what exactly we can do to help entrepreneurs and what their real needs and challenges are. Knowing this, we will be able to create a comfortable environment for their development and growth,” said Vladyslava Grudova, CEO of the KSE Institute.

The study identified a typical portrait of the Ukrainian female entrepreneur: a 36-year-old woman with about 6 years of business experience, low trust in the state, and loans, who started her own business for self-realisation. Internally displaced female entrepreneurs (IDPs) have a higher level of trust in the state and are interested in receiving loans, exporting, and joining business associations. Entrepreneurs from rural areas have the lowest business turnover, lower levels of access to training programmes and awareness of support programmes. Female entrepreneurs with disabilities are more likely to have been forced to start a business, as they face more barriers to employment. At the same time, such entrepreneurs have the oldest businesses (15 years and older).

Digital tools and services play an essential role in developing female entrepreneurship culture in Ukraine. During the last year, the Government of Ukraine launched several special programmes that promote the establishment and growth of businesses led by women.

“The development of female entrepreneurship is a priority direction of our work within the national project Diia.Business. From February 2023, every second new FOP [Individual Entrepreneur] in Ukraine is registered by women. That is why we are creating support programmes, such as the [business] acceleration programmes “Vidvazhna”, “Vlasne”, “Pochatok” and the educational grant programme “Mіtsnist”. Also, a separate section dedicated to female entrepreneurship was created on the Diia.Business portal. Over the year, more than 72,000 Ukrainians used Diia.Business services. Therefore, to better understand the needs and problems of female entrepreneurs, this study was conducted. The results will help us successfully implement initiatives to support women and understand the priorities of Ukrainian female entrepreneurs,” said Valeriya Ionan, the Deputy Minister of Digital Transformation for European Integration.

The development of businesses in Ukraine positively affects the overall macroeconomic situation. Further growth of this category of enterprises requires an increase in the proactive role of the state in this process, expansion of support programmes, and improvement of the business environment.

“Involvement of women in the labour market and entrepreneurship is a great priority of the state. That is why the Ministry of Economy of Ukraine implements many initiatives to achieve this goal. The “Vlasna Sprava” grant programme is such an initiative, where 55% of grant recipients are women. In addition, the Ministry of Economy provides a programme for veterans, female veterans, and spouses. As of today, female veterans and wives of veterans received 48% of all grants,” said Tetyana Berezhna, the Deputy Minister of the Economy of Ukraine.

Female entrepreneurship development programmes shall also consider the changes in the labour market that have arisen due to the full-scale Russian invasion.

“At the same time, the adoption of the new Labour Code, which the Ministry of Economy is currently working on, will allow the introduction of flexible forms of employment for easier inclusion of women in the labour market. These complex policy decisions of the Ministry of Economy are designed to increase the economic activity of women, which is very important in the conditions of the mobilization of men and a large number of Ukrainian women abroad,” added Tetyana Berezhna.

During the past year, there was a substantial increase in the initiative among women to start their businesses. The state’s task is to identify the needs and challenges that make it difficult to start and scale their business among female entrepreneurs in Ukraine.

“One of the areas of activity of the Entrepreneurship and Export Promotion Office is support development of female entrepreneurship. After analysing the number of requests from citizens to receive free consultations within the Diia.Business project and requests from Ukrainian women to participate in educational and grant programmes, we noticed a significant increase in trends in the female part of the population in terms of starting, developing, or scaling their businesses. Data from Opendatabot also evidence this, because in 2023, 56% of new FOPs in Ukraine were registered by women. To address the demand of Ukrainian women better and accordingly we create relevant opportunities for them, and together with our partners, we present a study of female entrepreneurship, which will help the Government of Ukraine and international partners to understand the needs and will serve as a basis for the creation and implementation of educational, consulting, and grant support programmes for Ukrainian women. The implementation of analytical services, projects, and services will contribute to the internationalisation of Ukrainian entrepreneurship,” said Andrii Remizov, the Director of Entrepreneurship and Export Promotion Office.

The most number of female entrepreneurs misidentify gender inequality, limiting it to the establishment of equal rights in Ukrainian legislation. Gender pressure is particularly strong in the early stages of business development, but stable partnerships and the accumulation of business experience help to reduce this pressure. Like the majority of female workers in Ukraine, many entrepreneurs also manage households and take care of children and elderly relatives.

According to the survey, the key challenges Ukrainian female entrepreneurs face include the effects of the economic crisis (44%), frequent changes in legislation and the tax system (283%), high competition (31%). Women entrepreneurs generally show a low level of trust in the state, especially regarding changes in legislation.

Support programmes for female entrepreneurs may not be perceived as a real opportunity for their business as survey shows. Even if they are aware of the existence of such programmes, female entrepreneurs do not perceive their accessibility. Grant support is associated with support to non-governmental organisations, creating a barrier to its wider use. There is also a perception among the interviewed entrepreneurs that the state is not interested in the development of microbusinesses, as well as small and medium-sized enterprises.

The list problems of vulnerable groups of Ukrainian female entrepreneurs include:

• For women in rural areas: Labour shortages, limited access to resources, and the need for assistance in interacting with local authorities.
• For female internally displaced persons entrepreneurs: Constant difficulties in restoring or establishing supply systems/partnerships and limited access to external financing.
• For female entrepreneurs with disabilities: Lack of adequate support regarding their disability and general mistrust in the state and assistance at other levels.
• For female veteran entrepreneurs: Difficulties in converting military experience into running a business while intersecting with a group of women with disabilities presents dual challenges.

Institutional support from international partners contributes to the development of existing tools to support female entrepreneurship and new programmes for developing professional skills.

“The British state is supporting women entrepreneurs in Ukraine through the implementation of targeted initiatives and collaboration, such as the Women’s Business Empowerment Programme, “Grow”, which has so far supported fifteen women entrepreneurs residing in war-affected communities. They learned how to improve business efficiency through effective management, as well as how to attract grant funds for micro, small, and medium-sized businesses. Our goal is to help these women increase their already significant contribution to the Ukrainian economy and contribute to the creation of a more equal society.”, – said Wendy De Luca, the Head of the Good Governance Fund Ukraine, British Embassy Kyiv.

Wendy De Luca paid special attention to the importance and benefits of digital tools for targeted support of women-in-businesses.

“Furthermore, as part of our work to support the economy, I’d like to take this opportunity to highlight two world-class government websites that support entrepreneurs (business.diia.gov.ua) and aim to help everyone in Ukraine manage their money. (harazd.bank.gov.ua) Please try them out.”

Among the recommendations for improving business conditions for Ukrainian female entrepreneurs at various levels, in particular, a more proactive position of the state to overcome the main challenges, the authors of the study propose the following:

• Training programmes should be developed and adapted, providing entrepreneurs both with basic skills and with strategic thinking, together with mentoring support and platforms for sharing experiences;

• Access to loans should be wider, in particular through the creation of specialized credit programmes, reduction of bias, which can contribute to the development of female entrepreneurship;

• Grant support programmes must have clear goals, be combined with mandatory training courses, and also take into account the specifics of vulnerable groups through targeted information channels (Diia.Business, online courses);

• Opportunities to participate in tender procedures should be expanded through participation in reconstruction tenders, as well as compensation programmes for the participation of female entrepreneurs in Prozorro.Market and public procurement in general;

• Communication with the state should take place at different stages and levels to solve existing problems, as well as to conduct consultations and communication campaigns explaining changes in legal regulation;

• Building business associations will help develop entrepreneurial skills, improve existing educational programmes, and involve female entrepreneurs in advocacy and decision-making;

• Information campaigns should encourage entrepreneurs to identify social and gender inequalities in business activities and contribute to their elimination through cooperation with business associations and other platforms;

• Support for female entrepreneurs from marginalised groups should be aimed at integrating women with disabilities and veterans, coordinating policies, creating specialized programmes for women in rural areas and IDPs, as well as taking into account psychological support and the local context.

Please find the complete study “Needs of and Challenges Faced by Ukrainian Female Entrepreneurs in the Conditions of Full-Scale War” via the link.