Key Evidence

Administrative complexity disproportionately discourages women from registering businesses.

Lengthy, multi-step procedures, required in-person visits, recurring and/or unclear fee structures, and paperwork requirements create significant barriers to registration, particularly for women. Women are generally more time- and mobility-constrained, which can make it difficult for them to travel to registration offices. They may also have less access to disposable income and tend to be more risk-averse, which can make them hesitant to pay registration fees. Finally, they may be unable to obtain necessary official documentation, such as lease agreements, proof of address, and identification. 

• Globally, 83.4% of women-owned enterprises operate informally, rising to 95.5% in low-income countries. Structural barriers - including complex registration procedures, limited asset ownership, unequal property rights, caregiving responsibilities, and lower access to technology - disproportionately constrain women’s transition into the formal sector. Operating informally limits access to formal finance, legal protections, and social insurance, reinforcing women’s economic vulnerability. (ILO, 2025)

Social norms and harassment further deter women from engaging with formal institutions.

Women entrepreneurs face discriminatory treatment or harassment during licensing and financial processes. In some contexts, laws or customary expectations require permission from male relatives for women to register a business, further limiting their ability to formalize independently. Women who are required to make in-person visits for registration have reported facing harassment and discrimination from officials.

• Women entrepreneurs report higher exposure to harassment and discriminatory treatment during official processes such as licensing, permitting, and loan applications, increasing the perceived and actual costs of formalization and discouraging engagement with formal institutions. (World Economic Forum, 2025)

Targeted policy reforms can improve women’s business formalization.

Evidence suggests that laws and policies simplifying procedures, reducing costs, improving access to information, and using trusted outreach channels can meaningfully increase women’s participation in business registration and formal economic systems.

• Policies that create simpler procedures and reduce administrative burdens increases engagement in business registration. For example, in Bangladesh discounted renewal rates and targeted outreach have been used to lower cost and information barriers that disproportionately deter women entrepreneurs from formalization. (MSC, 2024)