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    Business Loans for Women

    The business loans offered to women are often characterised by low interest rates, high tenures, waiver of security requirements, minimal processing fees, minimal documentation charges, etc. Most banks do not require any guarantors to provide business loans for women. Let’s discuss different aspects of these business loans available for women in India.

    Comparison of Best Business Loans for Women in 2019

    Some of the best business loans for women entrepreneurs in India are listed as follows:

    Lender Interest rate Maximum loan amount Maximum loan tenure
    Cent Kalyani by Central Bank of India From 8.9% p.a. onwards Rs.1 crore 7 years
    Shakti Scheme by Dena Bank From 9.85% p.a. onwards Rs.20 lakh Depends on the loan amount and other factors
    Synd Mahila Shakthi by Syndicate Bank 10.25% p.a. (for loans up to Rs.10 lakh) 10.00% p.a. (for loans above Rs.10 lakh) 9.75% p.a. (for micro enterprises) Rs.5 crore 7 to 10 years
    Udyogini Scheme by Punjab and Sind Bank From 10.60% p.a. onwards Assessed on a case-by-case basis Varies based on the loan amount
    Business loan for women by Bajaj Finserv From 18% p.a. onwards Rs.30 lakh Up to 96 months
    Stand-up India scheme by ICICI Bank Assessed on a case-by-case basis Rs.1 crore Varies based on the loan amount

    Cent Kalyani by Central Bank of India

    This is a small business loan offered by the Central Bank of India to promote sustainable employment opportunities for women in India. The business created with the help of the bank’s funds including its receivables, stocks, and assets is hypothecated automatically to the bank till the loan is repaid.

    Benefits and key highlights:

    • This loan is available for any women over the age of 18 years.
    • The bank offers loans to customers without any need for third-party guarantors and collateral.
    • Moratorium period ranges from 6 months to 1 year (included in the maximum loan tenure).
    Bank name Processing fee EMI (for Rs.5 lakh) Prepayment charges
    Cent Kalyani by Central Bank of India Starts from 0.25% of the sanctioned loan amount Rs.8,019 (for 7 years) 1% p.a. for loan amount Rs.20 lakh and above

    *Service tax or GST may be applicable over the charges given here

    Shakti Scheme by Dena Bank

    This scheme provides financial support to budding women entrepreneurs in the country. Under this scheme, the loan is offered for various purposes including agricultural activities, small enterprises, retail trade, housing, education, etc.

    Benefits and key highlights:

    • A concession of 25 basis points from the standard interest rate is offered to women beneficiaries.
    • The margin for this loan is likely to vary from time to time based on the discretion of the bank.
    • The maximum amount available under the microcredit scheme is Rs.50,000.
    Product Name Processing Fee EMI (for Rs.5 lakh) Prepayment charges
    Shakti scheme by Dena Bank Nil Rs.8,262 (for 7 years) 2% p.a. of the outstanding loan amount

    * GST on service charges up to 18% applicable on the loan.

    Synd Mahila Shakthi by Syndicate Bank

    Synd Mahila Shakthi is a loan product designed specifically to meet the entrepreneurial aspirations of women in India. The loan amount obtained from this product can be used to fund the capital requirements of new or existing business units.

    Benefits and key highlights:

    • The business venture financed by this loan must have women holding at least 50% of the ownership.
    • The loan is secured by hypothecating the assets bought using the bank’s finance.
    • Syndicate bank has set a margin of 15% for this loan.
    • This loan is offered without any collateral or third-party guarantee.
    Product Name Processing Fee EMI (for Rs.5 lakh) Prepayment charges
    Synd Mahila Shakthi by Syndicate Bank Nil Rs.8,365 (for 7 years) N/A

    *Service tax or GST may be applicable over the charges given here

    Udyogini Scheme by Punjab and Sind Bank

    This loan scheme is designed to help budding women entrepreneurs with their working capital needs. Loans are provided with various reasons including small business enterprises, agricultural activities, tiny SSI sector, or any other productive purposes. Some of the notable features of this loan scheme are given as follows:

    Benefits and key highlights:

    • There is no margin on loan amount up to Rs.25,000.
    • No collateral or security is required for loans up to Rs.25,000.
    • The share capital of women in the enterprise must be at least 51%.
    • If the enterprise is covered under Credit Guarantee Fund Scheme, no collateral or security is required for loans up to Rs.25 lakh.
    Product Name Processing Fee EMI (for Rs.5 lakh) Prepayment charges
    Udyogini Scheme by Punjab and Sind Bank Nil Rs.8,456 (for 7 years) N/A

    *Service tax or GST may be applicable over the charges given here

    Business loan for women by Bajaj Finserv

    This loan product provides business loans to satisfy the unique needs of women in India. This business loan comes with various flexible terms and conditions. It comes with a simple online application process, and approval is obtained within just 24 hours.

    Benefits and key highlights:

    • The documentation process is very minimal, and it requires only two documents to apply for this loan.
    • This loan is offered without any collateral or guarantor.
    • This also comes with the flexi loan options where you pay interest only for the amount withdrawn.
    Product Name Processing Fee EMI (for Rs.5 lakh) Fore Clouser charges
    Business loan for women by Bajaj Finserv Up to 3% of the loan amount Rs.10,509 (for 7 years and 2% processing fee) 4% of the outstanding loan amount

    *Service tax or GST may be applicable over the charges given here

    Stand-up India Scheme by ICICI Bank

    This is a loan scheme designed specifically for women and SC/ST individuals in the country. The loan amount is offered towards the working capital of a business enterprise of the borrower. If the business venture is a non-individual one, the borrower must own at least 51% of the enterprise.

    Benefits and key highlights:

    • The bank finance offered under this loan product shall not exceed 75% of the total business cost.
    • Car loans will be provided if the applicant is setting up a taxi rental service.
    • Loans offered for buying office equipment, machinery, furnishing materials, etc.
    • Borrowers can avail loans starting from Rs.10 lakh.
    Product Name Processing Fee EMI (for Rs.5 lakh) Fore Clouser charges
    Stand-up India Scheme by ICICI Bank Contact the bank for details N/A N/A

    *Service tax or GST may be applicable over the charges given here

    Eligibility

    As the name implies, these loans are designed specifically for women. Hence, the most important eligibility criteria to avail these loans is that you must be a woman. Even in partnership ventures, these loans can be availed only if the enterprise is at least 51% owned by women. The actual eligibility criteria may differ from one lender to another. Some of the general eligibility criteria outlined for business loans are listed as follows:

    • The applicant must be at least 18 years of age.
    • Most banks do not set any income ceiling for women while providing these business loans.
    • KYC norms set forth by the bank must be satisfied in order to avail these loans.
    • Some banks require educational background or technical qualifications in line with the business activity for which the loan is obtained.

    Things to Consider before Applying for Business Loans

    You must consider the following things before you apply for a business loan:

    • Before you apply for a business loan, you need to know the specific goals for which you are borrowing. If you are starting a new business venture, you must have a proper business plan. If you are using the funds for an existing plan, you need to clearly define your expansion strategy before getting the loan amount.
    • You need to determine how much amount you require for your business venture. If you overborrow, you will have trouble repaying the amount. If you don’t borrow enough funds, you might end up having inadequate working capital for your business. You need to find the right balance before applying for a business loan.
    • You also need to choose the loan tenure carefully. Most lenders in the market have flexible tenures when it comes to business loans. You need to choose the right loan tenure to ensure that the EMI amount fits within your budget.
    • You must choose the right lender for getting your business loan. Check out the interest rates, processing fees, other charges, etc., offered by various lenders before choosing a specific loan product. There are lenders who offer special discounts for women. Make the most out of your business loan by choosing loan products from these lenders.

    How to Apply?

        

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