To encourage the growth of women-owned businesses in India, several prominent private and public sector banks, along with Non-Banking Financial Companies (NBFCs), have introduced business loans for women tailored to support female entrepreneurs. Some lenders offer business and working capital loans at reduced interest rates to support women in their entrepreneurial journey.
Women are increasingly stepping into entrepreneurship and starting their own businesses. However, starting a business requires significant investment, and many women face challenges in obtaining funding. To address this, several financial institutions in India offer special business loans for women. Below are the five most popular loan schemes designed to support women entrepreneurs.
Business Loan Schemes for Women Entrepreneurs
1. Cent Kalyani by the Central Bank of India
The Central Bank of India provides business loans for women entrepreneurs looking to start, expand, or modify an existing business.
Features:
- Interest Rates: 8.70% – 8.95% per annum
- Purpose: To meet daily operational requirements, including purchasing and maintaining machinery & equipment
- Nature of the Loan:
- Term Loan: Fund-based facility for working capital
- Overdraft/Cash Credit: Non-fund-based working capital
- Letter of Credit/Letter of Guarantee: For trade purposes
- Maximum Loan Amount: Up to ₹10 lakh
- Processing Fee: Nil
- CGTMSE Coverage: Available
- Collateral/Security: Not required, as it is covered under the CGTMSE Guarantee Scheme
- Insurance: Comprehensive coverage for stock, equipment, and machinery, including bank-related clauses
This loan is available to women entrepreneurs engaged in various sectors, including rural industries, cottage industries, retail businesses, farming, government-backed enterprises, and MSMEs.
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2. Annapurna Scheme
The Annapurna Scheme provides business loan for women entrepreneurs who wish to start small businesses.
Features:
- Maximum Loan Amount: Up to ₹50,000
- Collateral Requirement: Not required
- Interest Rate: 13.5% per annum
- Loan Tenure: Up to 36 months
- Eligibility: Women over 18 years of age with a viable business plan
This scheme is particularly beneficial for women looking to start small food-related businesses such as catering, tiffin services, or home-based bakeries. The funds can be used to purchase kitchen equipment, raw materials, or delivery vehicles.
3. Stree Shakti Package
The Stree Shakti Package offers financial assistance to women entrepreneurs looking for capital to start or expand their businesses.
Features:
- Maximum Loan Amount: ₹50 lakh
- Interest Rate: 0.5% lower than the base rate
- Loan Tenure: Up to 10 years
- Eligibility: Women entrepreneurs who own at least 50% of the business
This scheme encourages women to take charge of their businesses by offering them financial stability and better loan terms. The reduced interest rate makes it easier for women-led enterprises to grow and sustain their operations.
4. Mudra Yojana
Mudra Yojana is a government initiative that provides financial support to small and micro-businesses, including those owned by women.
Features:
- Maximum Loan Amount: Up to ₹10 lakh
- Purpose: Suitable for women entrepreneurs running small businesses like retail stores, beauty salons, and tailoring shops
- Interest Rates: Vary depending on the loan type and duration
This scheme is divided into three categories:
- Shishu: Loans up to ₹50,000 for startups
- Kishor: Loans from ₹50,000 to ₹5 lakh for growing businesses
- Tarun: Loans from ₹5 lakh to ₹10 lakh for well-established businesses
Women entrepreneurs can take advantage of this scheme to scale their businesses without the burden of high- interest rates or excessive paperwork.
5. Mahila Udyam Nidhi Scheme
The Mahila Udyam Nidhi Scheme is specifically designed to help women entrepreneurs secure funding for starting or expanding a business.
Features:
- Maximum Loan Amount: Up to ₹10 lakh
- Interest Rate: Fixed at 12% per annum
- Loan Tenure: Up to 10 years
- Eligibility: Women over 18 years of age with a viable business plan
This scheme is especially useful for women entrepreneurs looking to modernize their business infrastructure, invest in new technology, or expand their production capacity. It also provides financial support for setting up new manufacturing units.
Additional Benefits of Business Loans for Women
Apart from these dedicated loan schemes, many banks and financial institutions offer incentives and benefits to encourage women entrepreneurs. These include:
- Lower Interest Rates: Many banks provide special interest rate discounts for women-led businesses.
- Minimal Collateral Requirements: Some loans do not require collateral, reducing financial risk for women entrepreneurs.
- Government Support: Several schemes are backed by the Indian government, ensuring reliability and security.
- Flexible Repayment Terms: Most business loans come with flexible repayment options to suit different business needs.
Conclusion
These are some of the top business loan schemes in India designed to support women entrepreneurs. By providing easy access to funds, these schemes enable women to start or expand their businesses, contributing to economic growth. Women entrepreneurs can choose a loan scheme that best fits their needs and take their business to the next level.
These loan programs are not just financial solutions but also a way to empower women to become successful business leaders. With increased financial independence, women entrepreneurs can create more job opportunities, innovate, and contribute significantly to India’s economy. If you are a woman entrepreneur looking to scale your business, exploring these business loans for women can be a great starting point.
