Women entrepreneurs are critical to progressing Canada’s future, contributing more than $150 billion to our economy annually and employing more than 1.5 million people. By supporting equal opportunities for women in the workplace, we could add an additional $150 billion to Canada's GDP by 2026.

But the contributions of women entrepreneurs goes well beyond financial metrics. Research shows their primary motivation for starting businesses is to make a difference in the world—a purpose-driven mindset that drives innovation and social impact.

However, when we look at who's receiving the necessary funding to build and sustain these businesses, we uncover persistent gaps that disproportionately affect BIPOC women entrepreneurs.

While women represent 38% of entrepreneurs in Canada, they receive less than 20% of traditional bank financing and less than 4% of venture capital. Access to business financing is even more challenging for Black, Indigenous, and women of colour, who face compounded systemic barriers.

As a 2021 survey reveals, 81.4% of Black women entrepreneurs rely on personal financing to fund their businesses. This often means turning to credit cards, personal savings, family loans, and sometimes even high-interest online lenders. This creates cycles of debt that prevent long-term growth and prosperity. In the same survey, 78.5% of Black women entrepreneurs identified financing and borrowing costs as major obstacles to their success.

For Indigenous women entrepreneurs, sustaining and scaling their ventures also proves particularly challenging due to a lack of accessible, affordable financing. As a national survey found, Indigenous entrepreneurs are three times more likely to anticipate bias or discrimination in their dealings with banks compared to other entrepreneurs.

The funding gap isn't just affecting individual business owners—it's negatively impacting our entire economy and in turn, hindering Canada’s potential. There’s enormous opportunity for growth in front of us, but we’ll only get there if all women have access to the support that they need and deserve.

Breaking Down Systemic Barriers

When we look into why BIPOC women entrepreneurs have so much difficulty accessing mainstream funding, we find complex intersectional barriers that create ongoing challenges.

Through focus groups and research conducted by The Forum and the AFIA DEI Index, three key areas consistently come up:

Institutional Barriers

Many BIPOC women entrepreneurs report that traditional funding processes often fail to consider their unique circumstances and business models—with online-only applications sometimes excluding them before they even have the opportunity to speak with someone about their business.

As one focus group participant shares, "The average funding approval process is quite impersonal and rigid, not allowing for the discretion necessary to properly analyze a business's capability to successfully repay a loan.”

This makes access to financing particularly challenging for entrepreneurs whose businesses fall into hybrid categories or have social impact components that traditional funding models don't easily categorize.

Personal Impact

Without access to generational wealth, which is a direct result of historical systemic inequalities, many turn to personal credit cards and savings to fund their ventures.

This creates a problematic cycle, as using personal credit can lower an entrepreneur’s credit score, which makes it even more difficult to access business financing down the road.

The time, energy, and resources that it takes to apply for funding is also significant. As another focus group participant explains, "We have to tweak our applications for this funder, then that funder, etc. It’s too much time spent rewriting to fit your box, when there are people hearing that there are people with money who can’t find us.”

Cultural Factors

An acquired lack of trust also plays a major role in access to business funding.

Many BIPOC communities have inherited a "do-it-yourself" mentality that comes from historical exclusion from financial institutions. Combined with real-world experiences of bias and discrimination, this has led many to believe that banks won’t lend to them.

At the same time, information on funding opportunities isn’t reaching BIPOC entrepreneurs: a study found that only 22% of Black entrepreneurs were even aware of major federal funding programs like those offered by the Business Development Bank of Canada or Export Development Canada.

BIPOC women also continue to face overt discrimination. During AFIA DEI focus groups, Indigenous women reported being subjected to extra scrutiny when using their Status Cards for identification, while Black women described having their business deposit checks repeatedly questioned for authenticity.

Creating Change Through the AFIA DEI Index

The Forum aims to play a critical role in addressing these systemic challenges through the AFIA DEI Index—the first initiative of its kind in Canada.

AFIA (Accelerating Financial Inclusion and Access) provides Canadian funders with evidence-based resources and services needed to advance Diversity, Equity, Inclusion (DEI) and Reconciliation in business funding.

The initiative works directly with banks, credit unions, and diverse entrepreneur groups to transform how funding decisions are made and remove barriers that have historically kept BIPOC women entrepreneurs from accessing critical capital.

Let’s Take Action

Funders

Canadian funders have a unique opportunity to drive meaningful change through the AFIA DEI Index.

If you work for a company or organization that provides funding to entrepreneurs, get involved to access training and resources and join a growing network of financial institutions committed to advancing DEI in business funding.

Get Involved