Starting a new business is always exciting. You are filled with so much enthusiasm and ideas that can change the lives of millions of people. As exciting as it sounds, starting a new business is not easy. A majority of startups shut down in the first year of opening. Many women entrepreneurs are emerging from metro cities and suburban areas of India to defeat all odds. These women founders have plenty of innovative ideas and profitable business models and are ready to take on the world. But as every business needs financial backing to sustain its operations, many women entrepreneurs are also looking to raise funds for their startups.
Though the number of women entrepreneurs in India is comparatively less than male entrepreneurs, the rising number of female founders has created a positive atmosphere in the industry as most women entrepreneurs find it challenging to raise funds for their startups, the government and private financing institutes offer funding schemes to startups led by women entrepreneurs. The goal of these schemes is to help women in India become financially independent and help them bring their ideas into reality. Many government schemes for female entrepreneurs in India currently support women founders with the required funding. If you are raising funds for your business, the following is a list of top business startup loan schemes for women entrepreneurs.
Alt text: – Image of Women Entrepreneurs getting a loan for their Startup
- Cent Kalyani Scheme
The Cent Kalyani scheme is a startup funding scheme offered by the Central Bank of India to support women entrepreneurs and provide them with business loans. The loan is exclusively offered to women entrepreneurs who want to start or expand an existing business. Unlike traditional business loans that require collateral as security, this is a collateral0-free scheme with no processing fee. Women involved in the agriculture industry, retailing firms, and women whose work is a part of the MSMEs are eligible to apply for this loan. The limit of this loan can be up to 1 crore.
- Mahila Udyam Nidhi Scheme
The Punjab National Bank offers this business loan to eligible women entrepreneurs in India. The Mahila Udyam Nidhi Scheme aims to provide MSMEs and supporting businesses led by women founders. The scheme offers financial assistance to women entrepreneurs who want to set up a beauty parlor, start an auto-rickshaw business, and do various other business purposes. The applicant gets 10 years as a duration to repay the loan. The amount limit for this scheme is up to 10 lakhs.
- Udyogini Scheme
The Udyogini scheme is one of the most popular government schemes for female entrepreneurs in India. The Women Development Corporation introduces the scheme to provide financial assistance to women entrepreneurs in India. The scheme is exclusive for women and helps to acquire various subsidized loans from public and private sector banks and reputed NBFCs connected to the scheme. The scheme covers more than 88 industries in which the applicants can apply to secure a business loan. The loan is unsecured, meaning you don’t have to provide collateral.
The maximum amount the applicant can get under the Udyogini scheme is up to 3 lakhs. The interest rates are very competitive compared to other business loan schemes and personal loans. The applicant must be more than 18 years of age and less than 55 years. On top of that, there is no income limit for disabled women and widows. The Udyogini scheme has supported thousands of women entrepreneurs from underdeveloped parts of India and helped them realize their dreams.
- Mudra Yojana scheme
The Government of India introduced the Mudra Yojana Scheme under the Pradhan Mantri Mudra Yojana project. The scheme aims to support women entrepreneurs in establishing and expanding their existing businesses. The loans are collateral-free, so you don’t have to worry about offering a property, gold, or anything as collateral. The Pradhan Mantri Mudra Yojana offers three schemes under it. The scheme’s three subcategories are the Shishu, Kishor, and Tarun, based on the business size and amount of business loan required. The applicant must be between 18 and 35 years old to be eligible to apply for this scheme.
Raising funding from private or government finance institutes can be challenging, especially when starting your business. To avoid all that hassle, you can consider revenue-based financing for your business. If you are worried about losing your equity to investors, revenue-based funding helps you avoid dilution. You need to pay back the investors from your monthly revenue in return for their investment. This way, the investors get the money back, and you don’t have to lose your equity. A win-win for both!
Being a woman entrepreneur, you already face many challenges like gender discrimination and societal pressure. Don’t let fundraising be another headache for you. Take a look at the business mentioned above funding schemes and find the one that suits your business needs and can help you bring your ideas into reality in the form of a profitable business.