Did you know that only 14% of the entrepreneurs in India are women? This difference isn't only about equality but also has economic consequences. To improve the situation, the government is introducing several schemes focusing on women entrepreneurs to bridge this gap.
Are you a woman who dreams of starting your own business or expanding an existing venture? If so, explore the opportunities and benefits of the Mahila Udyam Nidhi scheme.
Let's delve into the details of this scheme and explore how it's making a difference in women's lives across the country.
What is the Mahila Udyam Nidhi Yojana?
Initiated by the Small Industrial Development Bank of India (SIDBI), the Mahila Udyam Nidhi Yojana offers financial assistance and credit facilities to women entrepreneurs in production, manufacturing, and service-related industries.
While it was initially pioneered by the Punjab National Bank under SIDBI's guidance, this scheme has expanded to include other banks, showcasing its success and impact in empowering women entrepreneurs nationwide.
Loan features
1. Loan amount: Eligible women entrepreneurs and Micro, Small, and Medium Enterprises (MSME) can access loans of up to ₹10 Lakhs under this scheme.
2. Utilisation: The loan amount can be utilised for production, manufacturing, service-related activities, and upgrading existing manufacturing units and technology.
3. Repayment tenure: The maximum repayment tenure is 10 years, with an option to extend the loan moratorium for up to 5 years.
4. Loan limit: Up to 25% of the total project cost can be availed as a loan, with a ceiling of ₹2.5 Lakhs per project.
5. Interest rates: Women entrepreneurs receive loans at concessional interest rates. Interest rates depend on project cost, credit history, and business type.
6. Service charges: A service charge of 1% per year is applicable for loans under this scheme, with the possibility of waiver at the discretion of the lending authority.
7. Security requirement: No collateral or security is required to avail of loans under the Mahila Udyam Nidhi scheme.
8. Loan disbursement: While SIDBI sanctions the loan amount, it is disbursed through banks, NBFCs, and microfinance institutions.
Mahila Udyam Nidhi scheme eligibility criteria
To be eligible for support under the Mahila Udyam Nidhi Scheme, women entrepreneurs must meet specific criteria:
1. Entrepreneurs initiating or operating MSMEs, Tiny Units, or Small-Scale Industries (SSI).
2. The financial holding of women entrepreneurs should be at least 51%.
3. Businesses in manufacturing, production, services, or trading sectors.
4. MSMEs with a minimum investment of ₹ 5 lakh.
5. Activities include business expansion, improvement, diversification, and technology upgradation.
Project profile features
1. Project cost should be at most ₹ 10 lakh.
2. Loan limit is up to 25% of the project cost, with a maximum of ₹ 2.5 lakh per project.
3. SIDBI sets interest rates and may vary over time.
4. The bank applies a service charge of 1% per annum.
Approved business activities
1. Auto-repairing and servicing centre
2. Beauty parlour
3. Cable TV network
4. Canteen and restaurant
5. Computerised desktop publishing
6. Crèche
7. Cyber café
8. Daycare centre
9. ISD/STD booth
10. Laundry and dry cleaning
11. Mobile Repairing
12. Photocopying (Xerox) centre
13. Purchase of auto-rickshaws, two-wheelers, cars
14. TV repairing
15. Road transport operator
16. Salon
17. Servicing of agricultural and farm equipment
18. Tailoring
19. Training institute
20. Typing centre
21. Washing machines and other electronic and electrical gadgets, etc.
Benefits
What sets this scheme apart is its accessibility and favourable terms. The Mahila Udyam Nidhi scheme interest rates are competitive, and loans are often available without collateral. Additionally, the repayment period of up to 10 years, with a moratorium of up to 5 years, provides flexibility and breathing space for entrepreneurs.
Beyond financial assistance and business loans for women, the Mahila Udyam Nidhi Yojana offers a range of benefits to women entrepreneurs. It promotes women's economic empowerment, creates employment opportunities in the small-scale sector, and helps bridge the equity gap in entrepreneurship.
By supporting women-owned businesses, the scheme contributes to inclusive economic growth and fosters a culture of entrepreneurship among women.
Tentative Application process
Looking to apply for the scheme? Here's a guide on the Mahila Udyam Nidhi scheme’s online application process:
1. Visit the official website: Access the homepage of Punjab National Bank (PNB) on the official website.
2. Search for the scheme: Use the search function on the homepage and enter "Mahila Udyam Nidhi Yojana." Click on the search button to proceed.
3. Access the application form: A list of schemes will be displayed on the screen. Scroll down until you locate the application form for MSME loans. Select the option for loans up to ₹ 1 crore.
4. Download and print the form: Once you've selected the option, you will be redirected to the Mahila Udyam Nidhi scheme online application form page. Download the form and print it out for manual completion.
5. Fill out the form: Start filling out the application form from the second page, where the form begins. Enter details of documents for business loans such as Unit/Applicant names, Registered Office Address, Factory/Shop/Business Address, and complete contact information, including phone number, PAN card, email ID, and Udyog Number.
6. Provide business details: Enter comprehensive information about your business, including its nature, partners, banking/credit facilities, proposed machinery, and other equipment.
7. Collateral security details: Provide information about any collateral security, including third-party collateral, if applicable.
8. Past performance and future estimates: Fill in information regarding your firm's past performance and future business estimations.
9. Statutory obligations: Tick the appropriate option for statutory obligations.
10. Address and ID Proof: Enter your address and ID proof details as required.
11. Attach photograph and signature: Affix your recent photograph and signature on the designated areas of the form.
12. Complete and submit: Ensure all form sections are filled out accurately. Sign and date the form as required. Once completed, submit the form to the nearest PNB branch for verification and processing.
Final thoughts
Getting started with the Mahila Udyam Nidhi scheme is relatively straightforward. You can approach participating banks or financial institutions to inquire about the scheme and submit the application.
Seize the opportunity to fuel your business growth. With Tata Capital's business loans, you have the power to take your business to new heights. You can access the funding and support needed to realise your entrepreneurial dreams with the right business plan and determination.
To know more, visit the Tata Capital website or download the Tata Capital App today!
11 March 2024
6 mins read
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