By Terry Neese
In 1976, I was a successful new business owner who decided it was time to purchase an office for my growing company. At that time, an Oklahoma law required me to obtain a male relative’s signature to obtain a loan; I was completely unable to borrow money on my own, despite my personal success.
Refusing to accept the fact that I would need my husband’s signature, I found a building and worked out an arrangement with the seller whereby I was allowed to pay the building off over 10 years. I was able to pay off the building in five years and we are still in the same building today. This experience showed me firsthand some of the great barriers that women business owners faced, and inspired me to dedicate my time and passion towards women’s economic empowerment throughout my career.
It has been a little over a quarter of a century since President Ronald Reagan signed into law HR 5050 also known as the Women’s Business Ownership Act, on October 25, 1988. As a past president of the National Association of Women Business Owners, I was part of the movement that pushed this landmark piece of legislation through Congress.
The act aimed to facilitate women business owners by recognizing their value as entrepreneurs, increasing resources available to them, and ending the discriminatory state lending practices that had required me to obtain my husband’s signature for a loan. It also established the National Women’s Business Council, a panel that advises the president and legislators on issues involving economic issues relevant to women, and Women’s Business Centers, which help women across the country fund and run their businesses.
Great strides have been made as a result of HR 5050. One of the most important results directly stemming from the legislation is the Census Bureau’s inclusion of data on all women-run businesses rather than just a select few. Prior to HR5050, only some of the data on women in business was collected, resulting in inaccurate information that diminished the role of women in the workforce. With the proper data available, the true impact that women make on the economy has been realized, reinforcing the value of women-owned businesses.
While there have been many significant strides made when it comes to women in business there are many aspects that still fall short. According to the 21st Century Barriers to Women’s Entrepreneurship report from the U.S. Senate there are three hardships that women in business are up against:
- Women entrepreneurs still face challenges getting fair access to capital.
- Women entrepreneurs still face challenges getting equal access to federal grants,
- Women entrepreneurs still face challenges getting relevant business training and counseling.
When it comes to access to capital women are routinely turned down for loans only getting 4 percent of total dollar value of all small business loans. Some of the reasons behind women not receiving loans include the lack of collateral, strict banking regulations, perceived risk on the end of the lender, low or negative cash flow and revenues, and lack of preparation.
The federal government is supposed to award 5 percent of federal contracts to women, this quota has never been met. This means that women business owners are missing out on 4 billion dollars each year in capital.
Though there are Women Business Centers in almost 50 states, Congress has not been able to reauthorize it since the 1990’s. These centers in each state are sometimes the only place that are specifically for women in business. Since they have not been reauthorized, they are losing funding and are unable to adequately have the support, training and counseling that women business owners depend on.
Without the passage of HR5050, women business owners would not be where they are today. That does not mean that we should stop empowering women to be involved in the policies and procedures that affect women business owners. There are still many obstacles that face women in today’s society, without being involved no changes will be made.