Government Schemes for Women Entrepreneurs in India

IndiaFirst Life
• 19 Jul, 2024

Women across India are stepping into entrepreneurship with confidence and vision. According to a Bain & Company and Google report published in 2020, there are around 13.5 to 15.7 million women-led enterprises in India. To encourage this momentum and to take women’s entrepreneurship to newer heights, the Indian government has introduced several initiatives specifically aimed at supporting women in business.

Let’s explore the various programs and understand why financial security, including life insurance, is essential for female entrepreneurs.

Types of Government Schemes in India

Several government schemes for female entrepreneurs in India provide access to funding, mentorship, and capacity building.

Here are some of the most prominent ones:

Stand Up India Scheme

Launched by the Ministry of Finance, this scheme aims to promote financial inclusion and entrepreneurship among SC/ST and women entrepreneurs.

It facilitates bank loans ranging from ₹10 lakh to ₹1 crore, to help set up greenfield enterprises.

For non-individual enterprises, at least 51% of the shareholding and controlling stake must be held by either a member of the Scheduled Caste (SC) or the Scheduled Tribe (ST) community, or a woman entrepreneur.

If you are looking to avail a startup business loan for women in India by the government, this can be the ideal option.

2. Udyogini Scheme

Offered by the Karnataka state government to provide financial assistance to women, to start or expand businesses, and to gain self-reliance through trade and the service sector.
Special focus is on women from socially weaker backgrounds.
The goal is to offer women access to proper credit systems and reduce reliance on informal moneylenders who may charge high interest rates.

3. Pradhan Mantri Mudra Yojana

It is a flagship initiative by the Government of India to empower micro and small enterprises by providing easy access to credit.

Women can use this scheme to obtain loans of up to ₹20 lakhs for income-generating activities in non-farm sectors, such as manufacturing, trading, and services.

Loans under the Mudra Yojana are extended by Member Lending Institutions (MLIs) such as commercial banks, regional rural banks, small finance banks, NBFCs, and cooperative societies.

Out of the several government schemes for women entrepreneurs, this one includes three categories of funding:

Shishu (loans of up to ₹50,000)
Kishor (₹50,001 to ₹5 lakhs)
Tarun (₹5 lakhs to ₹20 lakhs)

4. Mahila Udyam Nidhi Scheme

The scheme provides collateral-free loans of up to ₹10 lakhs to women entrepreneurs.
Funds can be used for setting up or expanding manufacturing, service, or trade businesses.
Interest rates are concessional and vary on the basis of credit score, location, and project cost.
Loans are disbursed through banks, NBFCs, and MFIs, with a 1% annual service charge, which may be waived.

5. Mahila Coir Yojana

Part of the Coir Vikas Yojana, the government scheme for female entrepreneurs in India works under the Ministry of MSME.
It focuses on skill upgradation and promoting women entrepreneurs in the coir industry.
Offers training in spinning, weaving, and value-added coir product manufacturing.
Conducts entrepreneurship development programs, workshops, seminars, and exposure tours.

6. TREAD (Trade Related Entrepreneurship Development Assistance) Scheme

Aims at economic empowerment of women through self-employment in the non-farm sector.
Provides a grant by the Government of India, of up to 30% of the loan/credit (maximum ₹30 lakhs) to NGOs for various activities.
Primarily benefits women from Self-Help Groups (SHGs) engaged in micro-entrepreneurship.
Supports training, counselling, SHG formation, and participation in exhibitions.

These state and central government schemes for women entrepreneurs can help overcome the gender gap in business.

While government schemes provide the means to start and grow a business, they do not protect your family or enterprise from life's uncertainties. This is where financial protection tools, especially life insurance for entrepreneurs, come into play. Just as funding is crucial for launching a venture, insurance can be critical for securing it.

Why Life Insurance is Important for Women Entrepreneurs in India

Here’s why life insurance matters for women entrepreneurs:

Protects your family’s future

In the event of an untimely demise, life insurance plans ensure that your loved ones are not burdened with business liabilities or personal loans. To ensure wellbeing of loved ones after through cost-effective means, you may also consider options such as term insurance for women.

Safeguards business continuity

Some life insurance plans even allow coverage to be extended to business partners or can help pay off debts. This ensures the venture does not collapse due to a financial crisis.

Supports financial planning

Insurance policies with savings or investment components can help in building or reinvesting in your business. Some investment plans for women, such as ULIPs, can offer a seamless blend of insurance and wealth creation.

To determine the right coverage, you can use a life insurance calculator.

Government schemes for women entrepreneurs in India provide much-needed financial support, training, and tools to help women succeed. Whether it is opting for government schemes for women entrepreneurs or choosing the right life insurance for women, female entrepreneurs must embrace every resource that can help them build both business and personal security.

by IndiaFirst Life
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