India is a land of many opportunities, a clear reflection of which lies in the startup boom the country has witnessed in the recent decade. From food, beauty, travel, sanitation, IT, automobile, entertainment and even innovation, a new generation of emerging entrepreneurs has successfully tapped into lesser explored sectors, managed to provide solutions and build the groundwork for successful businesses.
And yet, barring a few names that stand out, women continue to be a distinct minority in the booming entrepreneurial space.
While conditioning, patriarchy and lack of social support from their own families may be a few reasons for several women, for the majority, lack of financial capital can be a major roadblock on their entrepreneurial journey.
So, today we list down eight schemes introduced by financial institutions in India, including nationalised banks, that all women entrepreneurs need to be aware of:
1. Annapurna Scheme
Under this scheme, the Government of India offers women entrepreneurs in food catering business, loans upto ₹50,000. The loaned amount could be used for working capital requirements such as buying utensils, cutlery, gas connection, refrigerator, mixer cum grinder, hot case, utensil stand, tiffin boxes, working table, water filter etc.
A guarantor is required to avail the loan and the assets of the business have to be pledged as collateral. Once sanctioned, it has to be repaid in 36 monthly installments (which equals to a period of three years). After the loan is sanctioned, the lender doesn’t have to pay the EMI for the first month. The interest rate is determined depending upon the market rate and the bank concerned. The State Bank of Mysore and Bharatiya Mahila Bank currently offers this scheme.
2. Stree Shakti Package For Women Entrepreneurs
The Stree Shakti Package is a unique SBI-run scheme to support entrepreneurship among women by providing certain concessions. This scheme is eligible for women who have majority ownership (over 50 percent) in a small business. Another requirement is that these entrepreneurs have to be enrolled in the Entrepreneurship Development Programmes (EDP) organised by their respective state agency. This scheme allows women to avail an interest concession of 0.05 percent on loans exceeding ₹2 lakh. No security is required for loans up to ₹5 lakh in case of tiny sector units.
3. Cent Kalyani Scheme
This scheme under the Central Bank of India can be availed by both existing and new entrepreneurs and self-employed women for micro/small enterprises like farming, handicrafts, food-processing, garment making, beauty, canteen, mobile restaurants, circulating libraries, day creches, STD/Xerox booths, tailoring etc. (in other words, agriculture, cottage industries, small and medium enterprises, government sponsored programs and retail trade.)
Under this scheme, loans up to ₹1 crore are sanctioned with a margin rate of 20 per cent. You do not require any collateral security or guarantors for this loan. Interest on loans depends on market rates. The loan tenure will be a maximum of seven years including a moratorium period of 6 months to 1 year.
Know more here.
4. Mudra Yojana Scheme
This is a general scheme for small units that women entrepreneurs can avail of too. Offered by nationalised banks under the Pradhan Mantri Mudra Yojana, this can be used to set up beauty parlour, tuition center, tailoring unit, etc. Loans between ₹50,000 to ₹50 lakh are sanctioned under this scheme. No collateral and guarantors are required for loans below ₹10 lakh.
The scheme has three plans:
Shishu – Grants you loans up to a maximum limit of ₹50,000 for a new business with rate of interest being 1 per cent per month or 12 per annum. The repayment period up to 5 years.
Kishore – Grants loans from ₹50,000 up to Rs 5 lakh for well-established businesses. The rate of interest varies with banks as it depends on the scheme guidelines and credit history of the applicant. Repayment period also depends on the discretion of the bank.
Tarun – Grants loans from ₹5 lakh up to ₹10 lakh for business expansion. The rate of interest is dependent on the bank as per the scheme guidelines and credit history of the applicant. Repayment period depends on the discretion of the bank.
To get a brief overview of interest rates for different banks, refer to this article by Bankbazaar.
5. Mahila Udyam Nidhi Scheme
Offered by Punjab National Bank and Small Industries Development Bank of India (SIDBI), this scheme supports women entrepreneurs to set up a new small-scale venture by extending loans upto ₹10 lakh to be repaid in 10 years. SIDBI also includes a five year moratorium period. The interest depends upon the market rates.
Under this scheme, SIDBI offers different plans for beauty parlours, day care centres, purchase of auto rickshaws, two-wheelers, cars, etc. It also assists with upgrading and modernisation of existing projects.
6. Dena Shakti Scheme
It provides loans up to ₹20 lakh for women entrepreneurs in agriculture, manufacturing, micro-credit, retail stores, or small enterprises. It also provides a concession of 0.25 percent on rate of interest. Loans up to ₹50,000 are offered under the microcredit category.
Know more here.
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7. Orient Mahila Vikas Yojana Scheme
Launched by Oriental Bank of Commerce, women, who hold a 51 per cent share capital individually or jointly in a proprietary concern, are eligible for the loan. No collateral security is required for loans between ₹10 lakhs to ₹25 lakhs for small-scale industries. The repayment period is seven years. It also provides a concession on the interest rate of up to 2 per cent.
8. Bhartiya Mahila Bank Business Loan
The scheme was implemented by Bhartiya Mahila Bank (BMB) which was later merged with State Bank of India in 2017. A public sector banking company established in 2013, it offered women entrepreneurs business loans up to ₹20 Crores for meeting working capital requirement, business expansion, or manufacturing enterprises.
It also offers special business loans with a lucrative rate of interest and grants collateral-free loan up to ₹1 crore under CGTMSE (Credit Guarantee Fund Trust for Micro and Small Enterprises) cover.
Women entrepreneurs are also offered 0.25 per cent concession in interest rate. It includes a combo of working capital and term loan. The repayment tenure is flexible and has to be repaid within seven years.
Some of the different plans under the scheme include:
Shringaar- The BMB Shringaar loan is applicable to self-employed women or homemakers who want to set up a parlour, purchase equipment, or meet daily business expenses. The loan doesn’t require you to provide any collateral security.
Parvarish- Similarly, BMB Parvarish loan is for self-employed women or homemakers to set up day-care creches. The upper limit of this loan can be ₹1 Crore without any collateral security under the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGSTSM) scheme.
Annapurna- Food entrepreneurs, between 18 to 60 years, wanting to start or expand their small business can avail this loan. Its features are similar to that of State Bank of Mysore’s Annapurna scheme, minus the fact that it does not require collateral security.
This list is by no means a comprehensive one and if you know any more such schemes, let us know in the comments.
(Edited by Saiqua Sultan)
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