17 Low Interest Business Loans for Women: Loan Amount, Documents, Eligibility
Entrepreneurship had been considered the forte of men in India. However this no more holds true. Women are equally catching up in the male dominated role contributing to the growth of the Indian economy.
Getting access to the capital is the key reason for impeding the growth of women entrepreneurship in India. However not many of us are aware that many financial institutions provide business loans for women entrepreneurs in India. These loans come with greater benefits compared to the normal loans available in the market.
Here is the table showing various loans for business women wanting to start or run their own business. These financing options aim to support entrepreneurship amongst females at concessional rates.
|Sr. No.||Name of Lender||Name of Loan / Scheme||Interest Rate||Loan limit (INR)|
|1||Central Bank of India||Cent Kalyani Scheme||Up to Rs. 10 Lacs - MCLR + 0.25%|
Up to Rs.1Crore - MCLR + 0.50%
|Upto 1 Crore|
|2||Dena Bank||Dena Shakti||25 basis point less than applicable rates||Upto 20, 00,000 (20 Lacs)|
|3||Small Industries Development Bank of India||Mahila Udyam Nidhi||Calculated at the time of application||10,00,000 (10 Lakhs)|
|4||Punjab and Sind Bank||Udyogini Scheme||As applicable to MSMEs||No margin upto Rs. 25, 000
Above Rs.25, 000 15-25%
|5||Bhartiya Mahila Bank||Shringaar||9.70% - 11.70%||Upto 50, 00,000 (50 Lacs)|
|6||Bhartiya Mahila Bank||Annapurna Scheme||9.70% - 11.70%||NA|
|7||Bhartiya Mahila Bank||Parvarish||9.70% - 11.70%||NA|
|8||Bank of India||Priyadarshini Yojana||0.50% less than the applicable rates||Upto 5, 00,000 (5 Lacs)|
|9||NKGSB Co-Operative Bank||Stree Sakhi||NA||Upto 2 Lacs|
|10||NKGSB Co-Operative Bank||Stree Udyogika||NA||80% of the project cost|
|11||Kerala State Women's Development||Schemes for forward class||6% - 8%||2, 00,000 (2 Lacs)|
|12||Kerala State Women's Development||New Swarnima||0.05||1, 00,000 (1 Lacs)|
|13||Kerala State Women's Development||Micro Finance||0.05||50000/member|
|14||Kerala State Women's Development||Mahila Samriddhi Yojana||0.04||50000/member|
|15||Kerala State Women's Development||Schemes for minority community||0.06||10, 00,000 (10 Lacs)|
|16||Kerala State Women's Development||Term Loan||6% - 8%||10, 00,000 (10 Lacs)|
|17||State Bank of India & Small Industries Development Bank of India||Stree Shakthi Package||0.50% less if loan amount exceeds 2 Lacs||50,000 - 25 Lacs|
There are many other financial institutions apart from the above listed ones providing loans to women entrepreneurs.
Apart from the above business loans, women can also get credit through the following options:
- Normal business loans
- Personal loans from banks/co-operative banks
- Peer to peer lenders – Lendbox, Lendcart and others. Check list of P2PL here.
- Get self finance either through their own savings
- Ask family / friends to lend money
Documents required for loans for setting business:
Documentation work required from females are:
- PAN card/Aadhaar card
- ID and address proof
- Passport sized photographs
- If woman is working then salary statement for last 6 months and Form-16
- If applicant already runs her own setup, then income tax return form, profit and loss statement, bank statement, and balance sheet or more business related papers.
Above documents are most basic required by every financing companies and requirements might change for each lender.
- Age of the applicant should be between 18 years – 55 years.
- Loans to women from economically weaker section are granted on the basis of income
- Proper availability of the documents listed above or as required
Points to keep in mind before opting for business loan:
- Collateral needed
- Compare interest rates with multiple lenders
- Bargain for interest rates
- Check loan foreclosure charges and processing fees
- Late payment fees
- Speed of loan disbursement
- Ease of repayment options
For what purpose can loan be used?
The credit received by the bank can be used for many purposes such as –
- Acquisition and setting of office/establishment
- Purchase of related equipments
- Managing day to day operating cost
Reasons of slow growth of women entrepreneurs in India:
There are many reasons for poor women entrepreneurship growth in India such as:
- People’s restricted mindset
- Gender bias
- Poor family support
- Work restrictions
- Long term prospects of the business i.e. expansion plans
- Lack of employee management especially men
- Difficulty in getting access to capital due to no or low income
- Certain businesses can be best handled by only men such as requiring floor work
- Poor access to internet connectivity especially in rural areas
However entrepreneurship in India has started getting higher importance from both rural and urban areas. Especially urban area is seeing the gap between men and women narrowing. Increased involvement of women in business is changing this age old mindset.