Government Schemes for Women Entrepreneurs
Women entrepreneurs are essential to the country. India is a patriarchal society, and as such, the gender disparity in terms of entrepreneurship is huge. More than five crores entrepreneurs in our country, but only 14% of the entrepreneurs are women. We must encourage our women entrepreneurs to progress as a society.
Women entrepreneurs create more than 2.7 crore jobs in India. The Government directly runs many schemes to promote these entrepreneurs. However, it is much easier to disburse credits through banks. That is why Governments start schemes like this under Government banks or Government Non-Banking Financial Companies (NBFCs). Keeping this in mind, Central and State Governments have initiated various schemes to help women entrepreneurs. Here are some of the most important schemes to help women entrepreneurs:
Women entrepreneurs looking to establish a food catering unit can take the benefit from this scheme. You can avail of a loan of up to Rs.50,000/- easily. The loan amount should be used to purchase kitchen equipment, kitchen supplies, etc. that will be used in the business’s day-to-day operation.
The loan availed via this scheme has to be paid within 3 years. You will get a grace period of 1 year after which you have to start repaying the loan. The grace period is there because it takes time to generate profits after starting a business.
This scheme was initiated to encourage women entrepreneurs looking to start a small business such as a tailoring unit, boutiques, etc. You can get loans from Rs.50,000 to Rs. 50,00,000. The special thing about the scheme is that you will not require collateral or guarantors on loans of less than Rs.10,00,000. There are three plans under this scheme, namely:
1. Shishu Plan: This plan is for women entrepreneurs looking to start a business or have just started a business. Loans of up to Rs.50,000 are available under this plan.
2. Kishor Plan: This plan is for established businesses. You can get loans of up to Rs.5,00,000 under this plan.
3. Tarun Plan: This plan is for businesses looking to expand their operations. You can get loans of up to Rs.50,00,000 under this plan.
Udyogini Scheme is for women who are working in agriculture, retail, or any other small venture. Women between the ages of 18 and 45 can get loans of up to Rs. 1,00,000. The family’s yearly income should be Rs. 45,000 or less. However, there is no such limit for women who are disabled, destitute, or widowed. Additionally, women belonging to the SC/ST community will get a subsidy on 30% of the loan amount or Rs.10,000, whichever is lower. Not only that, but women belonging to the general category can get a subsidy of Rs.7,500 or 20% of the loan amount, whichever is lower.
4. Stree Shakti
The Ministry of Micro, Small, and Medium enterprises helps organise Entrepreneurship Development Programs (EDP) to teach them about the various activities required for setting up an SME. Retail traders and business enterprises can get loans from Rs. 50,000 to Rs. 2,00,000. Professionals can get loans from Rs. 50,000 to Rs. 25,00,000. On loans of more than Rs.2,00,000, a concession of 0.50% on the interest rate is provided by the bank. Collateral is not required for loans of up to Rs. 5,00,000. This scheme is only for women entrepreneurs who own more than 50% of a small business.
5. TREAD Scheme
Trade-Related Entrepreneurship Assistance and Development or TREAD was launched with the primary objective of helping women entrepreneurs. Under this scheme, a project started by a woman will get financial assistance of 30% of the cost of the project (appraised by the bank). The bank will disburse the remaining 70% as a loan. The GOI grant and credit will be credited through approved NGOs. To maximise the reach of this scheme, the Government has allowed NGOs to provide credit to women entrepreneurs. Not only that, the partner NGOs will provide training and counselling to the women. The duration of the training program will be one month with each batch containing at least 20 participants.
Through the Small Industrial Development Bank of India (SIDBI), this scheme is offered by the Government to empower our women entrepreneurs and provide them with the capital to run their own business. The money availed under this scheme can be used in the service, manufacturing, and production sectors. Under this scheme, women entrepreneurs can get a loan of up to Rs. 10,00,000 for starting their own small venture. The financial assistance provided under this scheme can also be used to expand your business. You will have to repay the loan in ten years, including the moratorium period of five years.
This is a scheme initiated by the Central Bank of India. For women looking to start a new project, expand, or modernise their unit, this is the perfect scheme. Under this scheme, financial assistance can be taken for long-term assets such as plants and machinery and day-to-day operations. You can get a loan of up to Rs.1,00,00,000. The main attraction of this scheme is that there is no processing fee, and no collateral or guarantor is required. To be eligible for this scheme, you need to operate a micro or small enterprise (under the MSME Act of 2006).
Under this scheme, you can get a loan of up to Rs.20,00,00,000 (Rs. 20 crores). Plans under these schemes are intended to encourage marginalised women to start their own business. CGTMSE or Credit Guarantee Fund Trust for Micro and Small Enterprises provides for loans of up to Rs. 1,00,00,000 (Rs. 1 crore) without the need for any collateral. The repayment period of the loans under this scheme is seven years. There are different varieties of loans disbursed under this scheme:
1. BMB Shringaar: Women entrepreneurs can get a loan for the opening or upgrading of a spa, beauty parlour, or saloon.
2. BMB SME Easy: Under this plan, SMEs can get loans for up to Rs. 1,00,00,000 (Rs.1 crore).
3. BMB Parvarish: Women can get loans to start a daycare centre without needing any collateral. The loan availed under this scheme has to be repaid within 5 years.
Dena Shakti Scheme is for financing women entrepreneurs. You can get loans of up to Rs. 20,00,000 for agriculture, retail trade, education, and housing. Other than that, you can get a micro-loan of up to Rs. 50,000 easily. The interest rates will be 0.25% less than the base interest rates. The repayment period for this loan is 7 years. The processing fee is 0.50% of the loan amount. Women entrepreneurs who own more than 50% of their business are eligible to apply under this scheme. The repayment period is flexible, and you can repay the loan within 10 years.
Women who own more than 51% share capital in a company can benefit from this scheme. You will not need collateral for loans of up to Rs. 25,00,000. The repayment period for loans granted under this scheme is seven years. You can get a concession of up to 2% on interest rates.
Only 12% of startups had a woman co-founder in 2019. Governments recognise the hardships women have to face in our society, and as such, it has implemented many schemes for every kind of woman entrepreneur. You can get various incentives and benefits by availing of any of the schemes mentioned above. You should choose the scheme that fits your requirement and avail its benefits to start your entrepreneurial journey.
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