India currently has around 58.5 million entrepreneurs, of which almost 14% are women. While several woman entrepreneurs run businesses at urban centres, a majority of self-employed individuals in India populate the villages and smaller towns. T
his has necessitated specialised credit schemes for the growth and prosperity of their ventures.
The Udyogini Scheme is a step taken by the Government of India to encourage more women to establish businesses.
Through it, SME loans become more affordable and effective in setting up businesses.
What is the Udyogini Scheme?
Udyogini Scheme refers to a special credit-linked subsidy scheme, which is only available to women. Through this scheme, women can avail loans to operate their SMEs.
SME full form stands for Small and Medium Enterprise, which is indicative of the Udyogini Scheme’s target sector.
The initiative is primarily aimed at helping women from financially weaker sections establish a business.
The features and benefits of the scheme listed below should help an individual understand how it aims to resolve challenges for aspiring women business owners.
Features of Udyogini Scheme
- The substantial loan amount available
Eligible applicants can avail business loans worth up to Rs.3 lakh under this scheme. This high-valued credit can effectively reduce financial strain for a woman planning to initiate a business.
- Minimal interest rates
Women under this scheme can take advantage of subsidised interest rates on their business financing. In special cases, borrowers can also avail the SME loan free from any interest charges.
This significantly reduces the monthly instalment necessary to service such credit, ensuring minimal financial burden.
- Zero processing fee
Unlike other credit options, SME loans under this scheme come without any additional processing charges. Therefore, women entrepreneurs do not need to spend money out of their own pockets to avail these loans.
- No collateral necessary
Rural applicants rarely possess any property or asset of value to hypothecate against their loans. The Udyogini Scheme ensures that they do not have to present such an asset against business loans.
Unsecured credit options involve minimal documentation and hassle, thereby allowing one to freely access funds from financial institutions. This further enhances business loan for women in India.
Eligibility criteria for Udyogini Scheme
As stated previously, the Udyogini Scheme is only available to women entrepreneurs. Additional eligibility criteria for loan application under this scheme, include –
- The applicant’s age must be within 18 and 55 years.
- The family income for an applicant must not exceed Rs.1.5 lakh per year. This income limit is suspended for widowed and disabled applicants.
Keep in mind that these are simply the requirements for the Udyogini Scheme. Individuals should also consider the criteria for business loan application approval, as per their preferred lender.
Documents necessary for Udyogini application
Women, planning to take advantage of this scheme, need to arrange a few documents for simple application and approval.
- Ration card, Aadhaar card or Below Poverty Level card.
- Income certificate.
- Birth certificate.
- Caste certificate.
- Photocopies of savings account passbook.
Reputed financiers, such as Bajaj Finserv, allow Business Loan applications with minimal documents as well. Women entrepreneurs can take advantage of this hassle-free process to avail emergency funds for their business.
The company also provides pre-approved offers to streamline the loan application process further. These offers, which accelerate the lending process, are available on several financial products, including personal loans, business loans, and more.
Individuals can check their pre-approved offers by providing basic details, which include name and contact information.
With such effective schemes in place, an increasing number of women entrepreneurs are opting for SME loans today. This, in turn, is driving a new age in India, where rural women are achieving financial independence.