Cent Kalyani Scheme, Objectives, Interest Rates, Fees, Key Takeaways

A scheme to encourage and finance upcoming female entrepreneurs is a scheme by the Central Bank of India. The Cent Kalyani Yojna offers a chance for female entrepreneurs to come up with small and medium-scale businesses or modernize their existing businesses and nuance their setups as per the requirements of the modern-day business world.

This could also be used to expand the current business by increasing employees, furthering the manufacturing or service processes, and emerging even more successfully as a business owner.

The scheme is easy to apply and available from any branch of the Central Bank of India if you have an account. 

Objective

The essential purpose of the Cent Kalyani Scheme is to bring out the best in the industry led by female entrepreneurs engaged in small and medium-scale or cottage industries.

This is in accordance with the MSME Act, as enacted by the Government of India in 2006. The scheme is primarily directed at women employed in the manufacturing and service-oriented home-based and small-scale industry. Also women entrepreneurs who are planning to for finances, microloans is the best option.

For a female entrepreneur who is willing to open or has already set up her own business, this is a perfect scheme to establish their footing in their particular industry.

1. Addressing The Primary Focus of the Cent Kalyani Scheme is to specifically support women entrepreneurs by facilitating access to government initiatives, including employment opportunities, loans, subsidies, and more.
2. Empowering Another key goal is to empower women by identifying those in need and providing financial assistance to help them realize their aspirations.
3. Facilitating Growth A crucial objective behind the scheme is to actively guide women in expanding their businesses and addressing various business requirements.

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Targeted Sectors By Cent Kalyani Scheme

The sectors that are primarily being targeted by this scheme are both the manufacturing and service industries, enlisted as follows,

Also Read: MSME Schemes For Empowering Women Entrepreneurs

Exclusions of the Cent Kalyani Scheme

Although it covers many sectors of the MSME businesses run by women, there are a few exclusions that are not eligible for this scheme. These include the following;

• Individuals involved in the retail businesses, such as shopkeepers and grocery store owners
• Education and training institutes, whether self-financed or fund aided by other agencies
• Self-help groups are subsidized under several other government schemes

Here are 5 Government Grants given to women business owners.

The Purpose Of This scheme

The primary of the scheme is to help set up or expand a business in the MSME sector by means of a two-fold system:

1. Capital expenditure: The capital expenditure includes the procurement of one-time investment materials such as machinery, equipment, and plant setups.
2. Running expenditure: These include day expenditure materials such as consumables, electricity, water, and any other costs incurred during day-to-day business.

Nature of the Facilities Provided

The scheme offers a term loan fund-based working capital facility to thriving individuals and newcomers to the industry. These are in the forms of;

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Loan Amount and Margin from Cent Kalyani Scheme

The scheme offers a maximum loan of 100 lacs, which is 1 crore INR. This is with a margin of 20% in the business. The minimum amount is 1 lacs, and concession rates of interest are offered up to 10 lacs. This means that for a loan amount of 1 lac, the borrower must finance 20,000 INR out of their own pockets.

Cent Kalyani Scheme Loan Rates of interest

The rate of interest varies on the principal amount borrowed. The loan interest amount has various concession rates of different slabs of the borrowing amount.

• Upto 10 lacs: MCLR + 0.25%
• 10 lacs to 100 lacs: MCLR + 0.50%
• If rated by an external agency: An additional 0.25% is charged on MCLR + 0.25% or 0.50% depending upon the borrowing principal

Collaterals and Security

There are several benefits and perks as per the MSME Act, 2006, depending upon the type and amount of money borrowed. The securities and collaterals are as follows;

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Processing Fees and Insurance

There are no processing fees for this loan. Additionally, there is comprehensive insurance upon the equipment and machinery, or other plant materials, procured by the entrepreneur that is covered under the bank clauses. Please read the documents carefully before the application is processed.

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Documents Required For Cent Kalyani Scheme

Key Takeaways From This Scheme

The Cent Kalyani scheme is a welfare scheme that will help upcoming, and existing female entrepreneurs thrive and successfully run their businesses, with modernizations, as and when required, to upscale their businesses, improve their client base, and emerge as another success story for the books. The key takeaways of this scheme are:

• Only female entrepreneurs having a pre-existing or willing to set up a business may apply.
• 20% of the funding of the project must be financed by the entrepreneur or the investor
• The primary collaterals are on the plant setups, stocks, equipment, and other assets procured.
• There are no third-party guarantees needed as the CGTMSE scheme covers it.
• The fees for the first year of the CGTMSE scheme have to be paid directly to the bank when taking the loan.
• There are no processing fees for the loan
• The minimum amount is 1 lac
• The interest rate up to 10 lacs is MCLR + 0.25%
• The interest rate above 10 lacs is MCLR + 0.50%
• If an external agency rates the account, there is an additional 0.25% charge on the interest amount.
• The bank clause ensures the seed assets of the business, such as materials, equipment, plant setups, pieces of machinery, and any other assets that have been procured for the business.
• The scheme covers both capital investments as well as day-to-day running costs.
• Retailers, education and training institutes, and self-help groups with state or central government scheme subsidies are not eligible to apply.
• Both business owners and female professionals in the services industry are eligible to apply for the loan.

The Cent Kalyani Scheme is truly a marvel of a scheme that the central bank of India has put up to help potential entrepreneurs. However, we advise you to read the documents carefully before applying for such a loan.

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