The report by Democratic staffers of the Senate Small Business & Entrepreneurship Committee found that while businesses owned by women account for 30 percent of small companies, they receive only 4.4 percent of the total dollars in conventional small-business loans. That amounts to $1 for every $23 loaned.
In terms of numbers of loans, businesses owned by women receive only 16 percent of all conventional small-business loans, and 17 percent of loans backed by the Small Business Administration. Their loan applications are more likely to be rejected than those from businesses owned by men, and the loans they get are likely to have more stringent terms.
Women also receive only 7 percent of venture-capital funding.
"The numbers are jarring, for sure, and we need to own up to the fact that we want to see more women entrepreneurs, and to make sure they're getting access to capital," Committee Chair Maria Cantwell, D-Wash., told The Associated Press.
Women are also falling short in receiving government contracts. Although Congress in 1994 set a governmentwide goal of awarding 5 percent of federal contract dollars to small businesses owned by women, it hasn't met that goal. The closest it has come is 4 percent, in the fiscal year that ended Sept. 30, 2012, the report said. Failing to meet the goal costs women-owned businesses nearly $5.7 billion in government contracts each year, it said.
Congress needs to take steps to help women-owned businesses, including making changes to the SBA's microloan program aimed at helping companies borrow up to $50,000, the report said. It also called for the reauthorization of what's known as the Intermediary Lending Program, which allows business owners to borrow between $50,000 and $200,000.
Cantwell noted that women-owned small businesses may not need more traditional, and larger, SBA loans. That increases the importance of the smaller loan programs.
The report also called for the Securities and Exchange Commission to complete regulations to allow small businesses to crowdfund, or solicit investor money from the public through online portals.
The report also called for increased funding for Women's Business Centers, SBA-sponsored counseling programs for women owners around the country. Reduced funding and staffing at the centers has lowered the number of women owners they are able to help.
"We want to make sure women are getting appropriate counseling and training for business development," Cantwell said.
Despite challenges facing women owners, they are becoming a greater force in U.S. business, the report said. It noted that 4.6 percent of all U.S. companies were owned by women in 1972; in 2007, the latest year for which there is Census Bureau data available, they owned nearly 29 percent. Between 1997 and 2007, women-owned businesses added about 500,000 jobs, while the rest of privately held companies cut jobs.
The small business committee planned a hearing Wednesday on the issues that women small business owners face. Witnesses included SBA Administrator Maria Contreras-Sweet and Barbara Corcoran, the founder of the New York real estate company The Corcoran Group who also appears on the ABC program "Shark Tank."