Loans For Business Women: Financial Help For Women In India


Sourcing funding for business ventures is always tricky. However, there are a number of sources of funding for entrepreneurial ventures by women in India. These broadly fall under four categories:

Public sector bank loans: Schemes specially designed for women entrepreneurs funded by public sector (nationalised) banks. Advantage: relatively relaxed interest rates; disadvantage: tonnes of red tape.
Private sector bank loans: Loan schemes designed for business women funded by private banks. Advantage: higher quantum of loans; disadvantage: higher rates of interest.
Central/state government schemes: Grants and bursaries from Central and state governments for women entrepreneurs. Advantage: being a grant, no need for repayment; disadvantage: red tape, again, and the fact that grants only cover percentages of total monies required.
Grants from NGOs and other funding organisations: Grants and bursaries from private, developmental/philanthropic organisations. Advantage: higher packages of funding; disadvantage: usually highly competitive, and with the general requirement of the enterprise needing to be of a social/developmental nature.

Business woman

Here are some examples of these business loans for women in India.

  • Cent Kalyani – Central Bank of India:

Purpose:

The Central Bank of India offers the Cent Kalyani scheme, aimed at “offer[ing] financial assistance to women entrepreneurs for economic pursuits in Industry, Agricultural and Allied Activities, Business or Profession.”

Scope Of The Loan:

• Small Business: For entrepreneurs who intend to provide service (not a professional service) such as setting up a small lunch/canteen, mobile restaurant, circulating library etc.
Professional and Self Employed: Entrepreneurs who are specially qualified/skilled and experienced like Doctors, Chartered Accountants, Engineers or trained in Art or Craft etc.
• Retail Trade: For entrepreneurs who intend to engage in retail trading of various commodities.
• Village and Cottage/Tiny Industries: For entrepreneurs who are engaged in manufacturing, processing, preservation and services such as Handloom, Weaving Handicraft, Food-Processing, Garment making etc. in village and small towns with a population not exceeding 50,000/- utilising locally available resources/skills.
• Small Scale Industries: To start a unit engaged in manufacture, processing or preservation of goods.
• Agriculture & Allied Activities: For women entrepreneurs who are engaged/intend to engage in agricultural and allied activities, such as raising of crops, floriculture, fisheries, bee-keeping, nursery, sericulture etc. and also trading in agricultural inputs.
• Government Sponsored Programmes: Apart from the above schemes, women entrepreneurs are also financed under the various Government Sponsored Programmes where Capital subsidies are available.

Other Information:

For updated information about this loan’s quantum and interest rates, and to download application forms for the same, visit: www.centralbankofindia.co.in. The website may not contain all the information you need, so you might need to visit a local CBI branch for particulars.

  • Mahalir Loan – Tamilnad Mercantile Bank:

Purpose:

This scheme from the Tamilnad Mercantile Bank is “exclusively tailored for women in business to give them that extra edge and succeed.” The scheme is suited for a wide range of entrepreneurial needs.

Eligibility:

Women entrepreneurs consisting of all units managed by one or more women entrepreneurs in proprietary concern, or in which she/they individually or jointly have a share of not less than 51% as partners/share holders/directors of private limited company/members of co-operative society

Loan Quantum:

A loan may be taken for up to INR 10,00,000 (10 lakh rupees).

Repayment:

Working Capital Limit – 1 Year. The repayment period is fixed on the basis of income generation of the borrower up to the maximum of 7 years.

Security:

Primary security in the form of hypothecation of Stock/book debts/equipment/machineries, etc. Collateral security is also required to fully cover the advance.

Guarantee:

A guarantee needs to be obtained from the husband/father of the borrower. The bank states that “third Party guarantee need not be insisted.”

Other Information:

For more information on the bank’s interest rates and terms and conditions, visit: http://www.tmb.in/b_mahalir.htm.

  • Trade Related Entrepreneurship Assistance and Development (TREAD) Scheme for Women, Ministry of Micro, Small, and Medium-Sized Enterprises:

Purpose:

To provide financial assistance via a grant from the Government of India to women running NGOs in the realm of women development.

Eligibility:

Applicants must:
(a) Be a legal entity with a minimum registration of three years.
(b) Have experience in thrift and saving programmes with SHGs / individuals.
(c) Be engaged in entrepreneurship and income generation activities for women.
(d) Have basic infrastructure, qualified support staff and services to undertake microenterprise development for women.
(e) Prepare project proposals on behalf of women entrepreneurs / women Self Help Groups for income activity and take loan from financial institutions for onward disbursement to them.

Quantum and Scope:

Successful applicants receive a “Government Grant up to 30% of the total project cost as appraised by lending institutions which would finance the remaining 70% as loan assistance.” The grant is expected to aid:

(a) Training expenses of operating staff on reducing scale.
(b) Part of the expenses on operating a management and monitoring system viz. Computer Hardware and Software for MIS and vehicles.
(c) Charges for legal documentation viz. for payment of stamp duty for loans agreement, hiring of legal experts, valuation of assets, examination of title deeds etc.
(d) Auditor’s fee for auditing credit programme records.
(e) For establishment of new SHGs
(f) Common training / consultancy / networking inputs for the members (borrowers) relating to marketing, designing, packaging, quality control, technologies etc.

Other information:

For more detailed information and the application form, visit http://www.dcmsme.gov.in/schemes/treadwomen.htm

  • International Entrepreneurship Grants:

Skoll Foundation provides grants that support social entrepreneurial organisations across the globe.

Acumen Fund is a US organisation that links philanthropists with social entrepreneurs and organisations internationally.

Ford Foundation provides a wide variety of grants across several needs for both organisations and entrepreneurs.

  • Additional sources of information:

Business Loans and Business Credit – Learn how to get loans for your business without personal guarantees and without personal credit checks. This system and it shows you what to do to get access to bank loans.  This is a place for legitimate business men and women who want to accelerate their path to wealth and independence.

Business Credit Jumpstart: Insider Secrets To Getting Money From Banks And Lenders – If you’re looking to get your hands on business credit for your business… whether you are just getting off the ground or been in business for quite some time, then this is absolutely for you.

© Naaree.com

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2 Comments on “Loans For Business Women: Financial Help For Women In India”

  • checkings accounts wrote on 30 August, 2011, 13:43

    Really informational! Keep up the great work!

  • Invoice Factoring UK wrote on 28 May, 2012, 13:37

     To run a success business depends upon a lot of things. A planned business strategy plays an important role. Second and foremost important thing is the finance. Without a good financial backup, you will not be able to get success in your business. Business finance loan may help you in running the business successfully.

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