Female small business owners in China: Discouraged, not discriminated

Using a unique small business loan application dataset from a peer-to-peer (P2P) digital loan platform in China, we show that female entrepreneurs are more likely to be discouraged from applying for funds after a failed attempt compared to their male counterparts. Female discour-agement persists at different regional development levels and is prominent among those who need finance for working capital. Although digitization of financial markets has made external funding more accessible to small business owners, disclosing more information during the application process would help those discouraged from posting a new funding application.

Automated summary

Using a unique dataset from a P2P digital loan platform in China, it is shown that female entrepreneurs are more likely to be discouraged from applying for funding after a failed attempt compared to male entrepreneurs. This discouragement persists across different regional development levels and is particularly prominent among those who need working capital. Disclosing more information during the application process would help those discouraged from reapplying for funding.