Government Schemes for Women Entrepreneurs in India

The role of women in Indian households is rapidly evolving from being a homemaker to bread earner, and now to job providers and social entrepreneurs. With more women establishing start-ups, the economic development of India is reaching new heights. In order to support the endeavour of these women entrepreneurs, the Government of India strives to empower them through a number of supportive programs and schemes. More than 1,38,000 projects have been set up under the Prime Minister’s Employment Generation Programme (PMEGP), implemented by Khadi and Village Industries Commission (KVIC) Scheme. Some of the Schemes initiated by the Government of India in support of women entrepreneurs are:
 

Schemes Initiated by Government of India to Support Women Entrepreneurs]

 

1. Annapurna Scheme

   Many women prefer to start their own food catering business, which is supported financially through the Annapurna Scheme. Under this scheme, loans can be sanctioned up to Rs 50,000. A guarantor is required to underwrite the loan and assets need to be pledged as collaterals for the same. Interest rates vary as per market rate and the loan needs to be repaid within 3 years, though the first month after the loan is provided is excluded from the EMI.
    

1. Stree Shakti Scheme

   The Stree Shakti package is a unique scheme for women entrepreneurs, providing a concession of 0.5% in case the loan amount exceeds Rs 2,00,000. Loans up to Rs 50,00,000 can be sanctioned under this scheme, provided women have more than 50% share in the business. This scheme is provided to businesses enrolled under Entrepreneurship Development Programmes (EDP) organized by their respective state agency and no security is required for loans under Rs 5,00,000.
    

1. Udyogini Scheme

   The Udyogini scheme is meant for women from households that earn less than Rs 45,000 per year. Loans up to Rs 1, 00,000 are sanctioned for women aged between 18-45 years, and subsidy of 20% of the loan amount or Rs 7,500, whichever is lower is provided. There is no limit on loan for widows, destitute or disabled women and a subsidy of Rs 10,000 or 30% of the loan amount, whichever is lower is provided.
    

1. Cent Kalyani Scheme

   For women involved in SMEs, agricultural work or retail trading, the Cent Kalyani scheme is ideal to avail a loan, as amount up to Rs 1 crore is sanctioned with a margin rate of 20%. No collaterals or guarantors are required and there is no processing fee. Interest is charged according to market rate. The loan needs to be repaid within a maximum period of 7 years including a moratorium period of 6 to 12 months.
    

1. Mudra Yojna Scheme for Women

   This is a general scheme meant for urban women wanting to open a beauty parlour, day-care centre, tuition centre, boutique or any other similar small business. Loans from Rs 50,000 up to Rs 50 lakhs are sanctioned and no collaterals or guarantors are required for amounts less than Rs 10 lakhs. The scheme has three plans:
    
   • Shishu – Loans up to Rs 50,000 are provided for new business with interest rates of 12 % per annum for a period of 5 years.
   • Kishore – Loans from Rs 50,000 to Rs 5 lakhs are provided for well-established businesses and the interest rates vary as per credit score of the applicant.
   • Tarun – Loans from Rs 5 lakhs to Rs 10 lakhs are provided for business expansion. Again the interest rates vary as per credit score of the applicant.
    

Also Read: Top Government Business Loan Schemes in India
 

Other Funding Options for Women Entrepreneurs

 
Similar to government schemes, private lending institutions also offer a diverse range of business loan products. These loan products are designed to cover a broad range of expenses like -
 

• Working Capital Loan

  Working capital finance is a type of loan that is used to finance a company's day-to-day operations. It is designed to help womenpreneur meet their short-term financial needs, such as paying bills, purchasing inventory, and covering other expenses essential to running the business. These loans typically have a shorter repayment period and are meant to be used to support the ongoing operations of a business rather than for long-term investments or expansion.
   

• Invoice financing

  It is a type of funding that allows a business to borrow money based on the value of its outstanding invoices. The lender will advance a percentage of the invoice amount to your business, and you can then use that money to cover expenses while waiting for your customers to pay the invoices. This type of financing allows you to improve cash flow and manage your working capital effectively.
   

• Term Loan

  This is a short-term funding option that provides financial assistance for up to Rs 25,00,000. The repayment tenure for this loan product is 36 months and can assist in meeting any legitimate business expenses. You can opt for this product for paying staff salaries, utility bills, and business expansion. 
   

• Equipment Finance

  This is a secured loan designed to assist you in purchasing plants and machinery. If you own a factory or run a manufacturing unit, equipment finance is a great option for you.
   

Also Read: List of Benefits to Start-ups by the Indian Government

 

Conclusion

Women are considered the pillars of the society and empowering them contributes greatly to the development of the entire nation. Supporting visionary women not only helps her build a successful career, but it also aids in creating more job opportunities in the country. Today, many successful women entrepreneurs are contributing greatly towards the progress and development of the nation. To extend a financial support to such women with wings, the government has come up with many innovative schemes. Spreading awareness about these schemes is very important for this aid to reach the right place!
 
Disclaimer: This post was first published on 17th March and has been updated for the latest information, freshness and accuracy.