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Startup Business loan for Women entrepreneurs

  • 07-Mar-2022
Startup Business loan for Women entrepreneurs

What is a business loan? 

A business loan is a loan aimed at a business purpose. It includes the formation of debts that will be payback with an interest. It requires an appropriate amount of capital to finance a business.  

Benefits of a business loan for women 

  • Availability of security – Not every woman can offer collateral as a security to the banks or lenders to avail of the higher amount of loan. So, for them gold becomes the best option to use as collateral. 
  • Low-interest rate – Business loans for women required a higher rate of interest. But women who want to get a small business loan can get concession on interest rates. 
  • Less paperwork – In earlier days, business loans required a lot of paperwork which created difficulty to handle. Generally, to start a business for women needs an extensive list of business papers. Therefore, less documentation becomes the best way to make the procedure easy and saves time too.  
  •  Longer tenure - Banks and financial institutions give flexible repayment usage and this is the best advantage for the borrower as the longer tenure the monthly installment becomes less.  

Documents required for business loans for women

  • Application form: - Fill in an application form with all the required details and attach 1 passport-size photograph. 
  • Address proof: - Copy of Voter’s Id Card, Aadhar card, lease agreement, electricity bill, Passport, telephone bill, or Ration card. 
  • KYC Documents: - Article of Association (AOA), Incorporation certificate, Establishment and Shops certificate, Business entity proof, Partnership deed. 
  • Applicant's Identity proof: - Market Participant Identification Number card (MAPIN), Driving license, Voter’s ID card, Passport, and PAN Card. 
  • Age proof: - Voter Id card. Passport, and PAN card. 
  • Financial documents: - (Audited by Chartered Accountant) 
  • Last 6 months - Bank account statements. 
  • Last 2 years – Balance sheet 
  • Tax Audit reports 
  • Last 2 years – Profit & Loss account statement 
  • Last 2 years – IT Returns 
  • Current year performance and business turnover  

Also read: - Top 5 Startup Business Loan Schemes by Indian Government

Government loan schemes for women in India 

Given below are the government loan schemes for women applicants in India: - 

Udyogini scheme – Udyogini scheme refers to women’s empowerment. It is the initial concern by the Indian government to make them self-independent. This scheme aided poor women enterprises can have the advantage from liberal loans to inaugurate their business in various fields.   

Stree Shakti Yojana - The Stree Shakti Yojana is a distinctive scheme that is tailored for women who want to grow their existing business, or want to become entrepreneurs. Such women entrepreneurs should be engaged under the EDP (Entrepreneurship Development Programme) arranged by their specific state agency. 

Dena Shakti Scheme - The Dena Shakti Scheme gives loans up to Rs. 20 lakhs for women’s applicants in retail stores, small enterprises, manufacturing, micro-credit, or agriculture. 

Mudra Loan for Women - Mudra Loan for Women was established by the Indian government to provide financial support to women entrepreneurs. In India 14% of Indian entrepreneurs are women. The loans for this scheme are for both men and women which are provided by the financial bodies, Banks, and micro-financial institutions. It includes: 

  • Shishu loan  
  • Kishor loan  
  • Tarun loan  

Bhartiya Mahila Bank Business Loan - The Bhartiya Mahila Bank is a public sector banking company that offers loans up to Rs. 20 lakhs to the women entrepreneurs for Business expansion, working capital requirements, or manufacturing enterprises. Bhartiya Mahila Bank Business Loan involves: 

  • Parvarish  
  • Annapurna  
  • Shrinagar 

Annapurna Scheme - The Annapurna scheme is a social sector scheme and was established in 2000. The main objective of this scheme is to provide food assistance and it is issued to senior citizens who are appropriate but not involved in the scheme of National Old age Pension. 

Cent Kalyani Scheme - Cent Kalyani Scheme can be assisted by both new and existing entrepreneurs & self-employed women. Micro entrepreneurs such as cottage industries, farming, retail trade, and agriculture are eligible for the Cent Kalyani Scheme. 

Mahila Udyam Nidhi Yojana - The Mahila Udyam Nidhi Yojana scheme is offered by the Small Industrial Development Bank of India (SIDBI) to encourage women entrepreneurs and promote them through financial aid at the settlement of interest rates. 

Orient Mahila Vikas Yojana Scheme - An Orient Mahila Vikas Yojana Scheme was established by the Oriental Bank of Commerce. No security or collateral is required for the loans between 10 lakhs up to 25 lakhs and the repayment tenure is 7 years.  

Planning to get a business loan for women scheme by the Indian government. Apply through financeseva to get the best deals. 

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