The Sixth Economic Census published by the Ministry of Statistics and Programme Implementation shows that women entrepreneurs constitute a mere 14% of total entrepreneurship, that is, about 8.05 million out of 58.5 million entrepreneurs.
This situation is steadily improving, and the easy availability of a loan for women has been one of the contributing factors to this change. Following are some of the most viable options that have made it easier for women entrepreneurs to avail funds for their business –
1. Loan against securities
To start a small business, you may consider availing a loan against securities by pledging your investments. The most prominent benefit of availing this advance is that there is no end-use restriction on the loan amount. It can be channelled towards financing any number of requirements.
Usually, 60% to 75% of a pledged investment market value is offered as a loan by financiers. After the loan is repaid within the pre-fixed tenor, the collateral is released by the lender.
2. Small business finance
Small business finances are particularly designed to meet the requirements of SME enterprises. The credit is available not only for existing businesses but also to start-ups. For example, Line of Credit or LOC is extended to small to medium-scale businesses owned by women.
The optimum LOC amount is determined based on an applicant’s eligibility. Funds can be borrowed up to this maximum credit limit. The payable interest is levied on the amount used instead of on the entire credit limit, which helps you organise your business finances.
3. Commercial business loan
Commercial business loans are curated to provide instant funding for relevant credit requirements. Such loans for women do not require any collateral, making the approval process faster. These commercial loans are well suited for medium scale enterprises which seek to expand their operations.
Prominent NBFCs like Bajaj Finserv offer women up to Rs.45 lakh with a repayment tenor ranging for about 84 months. These loans also come at an attractive rate of interest. Such a loan corpus is likely to meet your business’s financial requirements efficiently.
Moreover, these financial institutions also extend pre-approved offers that facilitate the loan application process. Such offers are made available on different credit forms like business loan, personal loan, credit card etc. Check your pre-approved offer instantly by only submitting your name and contact number.
4. Government schemes
The government has launched multiple finance schemes with the objective of promoting women entrepreneurship. One of the most popular schemes is the Mahila Udhyami Yojana or Women Enterprise Program, where women entrepreneurs can avail a 0.25% discount on the interest rate of business loan. Under Pradhan Mantri Mudra Yojana, female entrepreneurs can avail the benefit from financial institutions through –
- Credit to Micro Enterprises
- Equipment Finance Scheme
- Refinance Schemes
- Mudra Card
Apart from these, one can opt for a personal loan sanctioned based on eligibility, income and credit score, that does not require any security to be pledged against the amount. Like any other online business loan, you can avail this flexible credit to expend in any professional or personal requirements.
One of the most significant benefits of availing such a collateral-free business loan is that it can be utilised to start a business, undertake expansion or simply manage daily expenditure of running an existing business. Some lenders also provide the opportunity to apply for the loan online, enhancing applicants’ convenience in the process.
Whether a women entrepreneur wants to start a home-based business or is aiming for a presence on a pan-India level, one may consider any of the options mentioned above. However, such loan for women should be chosen that suits the specific business requirements. For better insight, you may consult with a financial advisor and obtain an appropriate recommendation.
