It is heartening to see that the culture, economy, and the people of the Indian subcontinent have realized the importance of the other half of the population, i.e., women, in the development of the nation. Today, women have emerged as leaders in the corporate sector. However, a sector that has particularly witnessed robust growth in the participation of women is that of entrepreneurship. Women are playing as key a role as men in coming forward with brilliant venture ideas, and are playing an indispensable part in the soaring of the GDP to new heights. The government has also been trying to make the entrepreneurial process as easy as possible. It has introduced various government schemes to help women realize their entrepreneurial dreams. These schemes help in hassle-free procurement of funds.
The government has also instructed nationalized banks to launch various schemes. These schemes provide incredible support to those who want to kick-start their own business—especially to women entrepreneurs. They also provide assistance in expanding the operations of the business during the later stages of the venture.
Given below are the major schemes that have been launched by different nationalized banks in a bid to support budding women entrepreneurs.
5 Nationalized Bank Loan Options For Women Entrepreneurs
Stree Shakti Package for Women Entrepreneurs
This is the flagship program launched by the State Bank of India to promote women entrepreneurship in India. It provides loans to business women. Only women-owned businesses come under the definition of MSMEs as per this scheme. Besides, only those enterprises in which women own 51 percent or more of the share capital are eligible to benefit from this scheme. Women belonging to sectors such as retail trade, manufacturing, or services, and professions such as beautician, chartered accountancy, tailoring, and others can apply for the loan.
Also Read: 5 Grants For Women-Owned Businesses
Loan amounts between Rs 50,000 and Rs 25 lakhs can be granted under the scheme—the exact amount will depend on the type of business. The maximum amounts are granted under the profile of “profession,” whereas the minimum slab is for “retail” and “manufacturing.” Also, a concession of 0.5 percent on the interest rate is provided if the loan amount exceeds Rs 2 lakhs
There is no collateral requirement for amounts of up to Rs 10 lakhs. Further, if the loan qualifies under the CGTMSE scheme, then no collateral is required at all. A number of documents are required for a loan application under the Stree Shakti Package. These include identity proof, address proof, income tax returns, proof of business residence, the position of accounts, balance sheet, rent agreement, incorporation certificate, etc.
Also Read: 9 Schemes For Women Entrepreneurs In India
Synd Mahila Shakti Scheme
This scheme was launched by the Syndicate Bank for the promotion of women entrepreneurship. The businesses that qualify under this scheme are the same as the ones mentioned for the previous scheme. The enterprises can be sole-proprietor businesses, partnership firms, cooperative societies, public or private companies, etc. This scheme mainly provides loans to fulfill the working capital needs or the expansionary needs of an enterprise.
The maximum loan amount that can be disbursed is Rs 5 crores at the concessional rates. The present base rate of the bank is applied to loans of amounts up to Rs 10 lakhs. If the loan amount exceeds this threshold limit, there is a concession of 0.25 percent on the base percentage.
The loan does not require any kind of security. There are no processing charges, either. The tenure of the loans is very flexible, and ranges from 7 years to 10 years. The scheme also provides free credit card facilities, free skill-development training, etc.
The same documents as those mentioned for the Stree Shakti Package are required.
Cent Kalyani Scheme:
This scheme was launched by the Central Bank of India to generate sustainable and continuous opportunities for women. Women of 18 years and above can apply. Loans are provided mostly to MSMEs. The loan amount can be used to start the business, to expand it, or to maintain its working capital.
The maximum loan amount that can be granted under this scheme is Rs 100 lakhs. The interest rate begins from 8.75 percent and varies as per the amount granted.
No collateral or security is required. The tenure for repayment can extend to a maximum of 7 years. The documents required are the same as the ones mentioned for the other two schemes. The only difference is that a letter of hypothecation is also required for this scheme.
Bharatiya Mahila Bank Scheme:
Bharatiya Mahila Bank is now a part of the State Bank of India, as they merged in 2017. The Bharatiya Mahila Bank scheme mainly provides loans to businesses in the retail sector. The businesses that qualify are micro, medium, and small enterprises.
The maximum loan amount that can be sanctioned under this scheme is Rs 20 crores. The interest rate starts from 10.25 percent. Concessions of 0.25 percent can be availed on the base rate as per the rules and regulations of the SBI and RBI.
Like the other schemes listed in this article, the scheme is collateral-free and security free, too. The other provisions are the same as that of the Stree Shakti Package of SBI.
The last scheme in our list is the Shakti Scheme from Dena Bank. It issues loans to the businesswomen who own more than 50 percent stake in an enterprise.
The maximum loan amount that can be granted is Rs 20 lakhs for the retail trade and education sectors and Rs 50,000 for micro-enterprises. The interest rate is 0.25 percent below the base rate for women applicants.
The loan is free of collateral and requires zero processing fees. The tenure is highly flexible and depends upon the profile of the loan seeker and the loan amount sanctioned.
The same documents as those mentioned for the others schemes are required.
Other schemes such as the Annapurna Scheme, Udyogini Scheme, Mudra Yojna, and Orient Mahila Vikas Yojana by the government provide similar loans.
To decide on the scheme that you must choose, consider your needs as an entrepreneur alongside the interest rate, loan amount, tenure, etc. You could also take professional advice regarding this.
It is evident that the government has launched several initiatives to encourage women-owned businesses. Now it is up to us to exploit these opportunities to contribute to our country’s economy. We must work to realize the dream of “Make in India,” and play a role in transforming India into a developed country.
Indifi is a market leader in the space of business loans. If you have any doubts pertaining to business loans, feel free to reach out to us. We will be delighted to help.