LONDON (Reuters) — Women-led businesses need more support from the government if female entrepreneurs are to overcome lack of confidence and finance to achieve their real potential, a study said last week.The report by research programme Global Entrepreneurship Monitor (GEM) published to mark National Women's Enterprise Day found women needed bigger incentives than men to take the risk of setting up on their own.

The report found women were less likely than men to think they had the skills to start a business or to know an entrepreneur personally and to think there were good business opportunities to be exploited.

"Growing the number of women-owned businesses in the UK is essential for increased economic development, greater innovation and creativity," said Isabella Moore, president of Prowess, the UK organisation for groups promoting female enterprise.

Prowess commissioned the report by GEM.

"Encouraging women's entrepreneurship is also about providing more flexible opportunities for women of all ages and from all backgrounds," Moore added.

The report said government initiatives started in 2003 had boosted activity in the regions and at local level but central government had not done enough to further development.

Female entrepreneurial activity is nearly twice as high for rural women as for urban women, it said.

In particular, the report criticised the government's failure to appoint a Women's Enterprise Task Force promised a year ago.

It called for sustained commitment from central government, regional agencies and the private sector for incentives such as promoting role models, tax relief on childcare and training for the unemployed -- particularly for women from ethnic minority communities in deprived areas.

"While more women are seeking advice, and expert evidence suggests that attitudes are improving, actual business support is still patchy across the UK and critically under-resourced," the report said.

In terms of growth, it found a mixed message.

The percentage of the female working population involved in the early stages of setting up a business was steady at 3.8 percent last year. For men it had declined to 8.1 percent in 2005 from 9.8 percent a year earlier.

More positively, women's businesses were praised for showing a strong commitment to social enterprise and new technology.

Women were found to be more likely than men to have social, as well as financial motivations and tended to be innovative as they often founded companies addressing family and community issues neglected by male-owned businesses.

Technology was seen as key to enabling women find work they could do from home and fit round family.

Female entrepreneurs were also quicker to embrace new technology, with twice as many women than men setting up around a technology that was less than a year old.