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Women are being forced to beg and borrow from loved ones to fund their start-ups, Natwest chief says as she launches new crowdfunding scheme

Jamie Johnson
Alison Rose, Deputy CEO of NatWest said that the current start-up funding gap between men and women is “frankly unacceptable” - JULIAN SIMMONDS

One of Britain’s leading bankers has warned female entrepreneurs to stop saddling themselves with credit card debt as the first female-only crowdfunding scheme is launched.

Alison Rose, Deputy CEO of NatWest said that the current start-up funding gap between men and women is “frankly unacceptable” and it would be “negligent” not to offer practical support.

Speaking at The Telegraph following the launch of her government-commissioned review into the barriers facing female entrepreneurs, Ms Rose said: “A lot of female entrepreneurs start by using their credit card or borrowing from their family and getting into debt to get their business going. That is a really bad way to start.

“Putting lots of debt into start up businesses is really difficult because you lose flexibility and it puts a lot of financial burden on individuals.”

Nearly three quarters of female founders are forced to fund their ventures out of their own pockets. A Telegraph survey of 750 female founders found that 72 per cent had used their own credit cards, cash and savings to fund their businesses.

In response to the Telegraph’s Women Mean Business campaign the Rose review found that if women were creating businesses and scaling up at the same rate as men, the boost to the UK economy would be worth £250 billion over the next ten years.

In order to open up new revenue streams, Ms Rose announced the first female-only crowdfunding scheme, with NatWest putting £1 million into the pot.

The programme is designed to help create an additional 65,000 new female led businesses by 2025.

“Access to, and awareness of different types of funding and capital is a major barrier for women looking to start up or scale a business,” said Ms Rose.

“For too long women have been put off from starting a business by a number of factors, we want to make this a thing of the past.”

Yesterday, she said: “The Telegraph campaign has been inspiring.”

Speaking at the same event, Michael Cole-Fontayn, chairman of the Association of Financial Markets in Europe said: “You started with a vision around business and getting the focus on the area where there is a real business opportunity.

“What you have achieved in less than a year is an amazing movement and you are changing the policies and systems that need changing.”

Commenting on the Rose review, Prime Minister Theresa May said: “I want to build a country where all women can go as far as their talents and hard work can take them.

“It’s fantastic that we already have over a million women-led businesses, and the gender pay gap is at a record low, but the findings in this Review show there is much further to go.

“I am committed to real change in this area, starting with our action today to encourage more companies to look at the gender split of who they choose to invest in.”

As well as compelling banks to publish regular updates on how much they invest in businesses run by women, compared with those run by men, the review set out other initiatives, including accelerating the development and roll-out of entrepreneurship-related courses to schools and colleges.

The government has also pledged to improve online information and guidance for all aspiring entrepreneurs and businesses, building on previous commitments at Budget 2018 and the upcoming Spending Review.