How emergency loans help women entrepreneurs build financial resilience
Adapted from an article originally published on Accion's website, available here.
Women entrepreneurs globally are the backbone of their communities. They are simultaneously primary caregivers, household managers, farmers, and small business owners, helping to drive local economies. In India, women-led businesses represent 20.5% of all registered micro, small, and medium enterprises, many in rural areas, and contribute upwards of 17% to GDP. This is despite disguised employment among women entrepreneurs, which leads to an underestimation of their economic contributions.
While women play an important role in their families, communities, and the country’s economy, they continue to have limited access to credit and fewer resources to help them weather a sudden financial predicament. Due to systemic and persistent gender disparities, they are disproportionately vulnerable to financial shocks, having negative effects on business, health and children’s education. Without proper support, emergencies lead to business closures, borrowing from informal sources, or prolonged uncertainty.
Accion’s partner, Annapurna Finance, is a leading Indian microfinance institution serving nearly 3 million customers, the majority of them low-income women entrepreneurs in rural areas. Recognizing the need for an emergency credit product, Annapurna developed a digitally enabled “just-in-time” (JIT) loan. Conceived with Accion Advisory’s support during the COVID-19 pandemic, the JIT loan aims to provide quick financial assistance for emergencies to Annapurna’s existing customers. With funding support from Swiss Capacity Building Facility (SCBF), Accion teamed up again to enhance the product and expand customer outreach.
Emergency loans as a tool for building resilience
Leelabati Baral is one of the earlier JIT loan customers and runs a tailoring business from her home in Bhubaneshwar, Odisha. When the pandemic disrupted her business and threatened her income, she applied for and received a JIT loan to help her stay afloat. As conditions improved, she was able to purchase additional stock to expand and serve more customers. Without the JIT loan, it would have been much more difficult, if not impossible, for Leelabati to overcome her cash flow crisis and grow her business.
For Sanjukta Kandi, the JIT loan proved invaluable during a health emergency. She urgently needed medication, but lacked immediate funds to cover even those basic costs. A long-time customer, Sanjukta contacted Annapurna and was able to access a ₹5,000 JIT loan within the hour. While the amount was modest, it was enough to purchase the necessary medicines and begin her recovery. Soon after, Sanjukta was able to return to her small grocery shop and resume her daily routine, thanks to timely support that helped her stay afloat.
What makes an emergency loan effective?
The JIT loan was designed to be fast and flexible, which contributed greatly to its positive reception among customers. Other existing loans in the market could not be accessed easily or quickly enough in an emergency. Many are also extended as regular term loans, which makes them inherently less flexible — and less desirable. Accion Advisory helped Annapurna build a near-instant, usage-based loan that can be requested via SMS or WhatsApp, allowing customers to repay and use the amount as they like. Loans can also be requested through an automated voice-based service, which uses vernacular language and allows customers to place a JIT loan request by phone, enabling an accessible and user-friendly process.
The JIT loan is pre-approved based on the customer’s history with Annapurna, which reduces processing time, and can be used for various purposes, including medical bills, education expenses, debt consolidation, repairs and renovations, and business needs. Annapurna’s evaluation process assesses the customer’s existing loans and their repayment capacity to ensure they can responsibly take on additional credit. This upholds the institution’s commitment to industry-recognized client protection principles and safeguarding customers from the risk of over-indebtedness.
Building on the JIT loan’s existing product composition, Accion worked with Annapurna to identify areas for improvement and proposed development specifications for an enhanced version of the loan. Product enhancements include establishing a credit line instead of a regular loan and faster processing time.
To support the upgraded product’s roll-out, Accion developed training and capacity-building materials for Annapurna’s staff and customers. They supported training for loan officers on the new product features and provided guidance on communicating changes to the customers. They also developed and supported the execution of a go-to-market strategy for reaching more customers and driving product uptake.
As of June 2025, the JIT loan has reached nearly 120,000 additional rural women customers and has elicited positive feedback since its launch:
<> 76% of surveyed customers cited improvement in their quality of life
<> More than 70% of surveyed customers believed the product resolved key financial challenges
<> More than 90% of surveyed customers used the JIT loan for emergencies as intended
Efforts to scale the product further have been impacted by evolving microfinance regulations. During the project implementation period, the Reserve Bank of India (RBI) imposed tighter restrictions on microfinance lenders. Institutions could no longer issue new loans to borrowers until their existing loans were fully repaid, which made it difficult to offer pre-approved loans.
Despite this obstacle, Annapurna and its customers still benefit. The JIT loan is recognized as an innovative product, first in the local microfinance industry, and has performed exceptionally well, maintaining a low delinquency rate. It has also helped raise customer loyalty and satisfaction. Many Annapurna customers are small business owners or farmers who are vulnerable to income disruptions and appreciate having access to emergency funds when needed.
Annapurna is keen to renew the product once the regulations and market conditions are stable.
Supporting rural women to transit from crisis recovery to long-term stability
The JIT loan also provided opportunities for customers to access a wider range of digital financial services. Leelabati, for example, gained confidence in using digital channels and soon progressed to digital payments. As her tailoring business grew, customers increasingly requested the service, prompting her to install a digital payment platform and accept payments through her smartphone. Exposure to more digitally enabled products and services helps Leelabati and other women entrepreneurs strengthen their business management capacity and build financial resilience.
Financial tools like the JIT and other emergency loans are critical support systems that enable rural women to retain financial control in times of uncertainty and regain economic stability. When women can recover more quickly from unexpected shocks, they are better positioned to restore their livelihoods and sustain their families and communities.
Learn more about our work with Accion and Annapurna supporting rural women in India.
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