to external finance, thus restricting their investment and growth. Table 4a displays the averages for several measures of access to external finance among female-owned firms<sup>9</sup> . These averages indicate that the majority of female-owned firms in the Bolivian and Peruvian data rely on internal funds for financing working capital (78 percent). In the Enterprise Surveys, which cover larger firms, this number is lower, 46.9 percent. Female-owned firms in the Enterprise Surveys are much more likely to rely on bank funds for financing working capital than female-owned firms in the Bolivian and Peruvian data. The Enterprise Surveys also include information on the source for funds for financing investment. 56 percent of these funds are internal, and 20.4 percent come from banks. The fraction of female-owned firms that have a loan from a financial institution varies greatly across datasets, ranging from a low 8 percent in the Mexican data, to 52.4 percent in the Peruvian data.

**<u>Table 4a: Access to External Finance – Averages for Female-Owned Firms</u>**

||Mexico|Bolivia|Peru|Enterprise<br>Surveys|
|---|---|---|---|---|
|% of working capital financed with internal funds||78.9|77.9|46.9|
|% of working capital financed by banks||3.2|7.8|23.3|
|% of investment financed with internal funds||||56.0|
|% of investment financed by banks||||20.4|
|Participates in a ROSCA||28.1|||
|Has aloan fromafinancial institution|8.09#|24.0|52.4|46.7|

_Note_ :<sup>#</sup> In the Mexican data, this measure refers to ever having had a loan since starting the business, rather than currently having a loan. _Source_ : Encuesta Nacional de Micronegocios (ENAMIN), 2002, Bolivian World Bank Micro Enterprises Survey, 2007, Peruvian World Bank Micro Enterprises Survey, 2008, World Bank Enterprise Surveys for Brazil, Ecuador, El Salvador, Guatemala, Honduras, and Nicaragua, 2003.

Table 4b shows the corresponding statistical difference in the measures of access to external finance across female-owned and male-owned firms. For ease of comparison with Table 4a, these differences do not control for region or industry effects. However, the results do not change significantly when including region and industry fixed effects. The differences in Table 4b do not support the hypothesis that female-owned firm have less access to finance than male-owned firms. There are no statistically significant differences in the use of bank finance for working capital or investment. In the Mexican and Peruvian data, there is also no statistically significant difference in the percentage of female-owned and male-owned firms that have a loan from a financial institution. In the Enterprise data, female-owned firm are 5.2 percent more likely to hold a bank loan than male-owned firms. In the Bolivian data, female-owned firms are significantly less likely to have a loan from a financial intuition. However, female firm owners are more likely to participate in a Rotating Savings and Credit Association (ROSCA), an informal savings and borrowing arrangement among individuals. Female-owned firms in the Bolivian data may thus be substituting informal financing for formal financing. The survey does not include the necessary information to gauge whether this is due to the fact that they do not have access to formal financing. A recent World Bank report complemented the Bolivian survey

> 9 Appendix Table A2 disaggregates the statistics for the Enterprise Surveys by country, so that it displays all statistics separately for Brazil, Ecuador, El Salvador, Guatemala, Honduras, and Nicaragua. The statistics in Appendix Table A2 illustrate that the findings from Table 4b and Table 5 are not driven by outliers.

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