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Many widespread social values support the patriarchal system which does not create an enabling environment for women to work except when necessary. Women have always tried to get rid of this traditional mold. Recently, more and more women have emerged into the league of serious, ambitious and determined business owners. However, there is still a lot to be done as women entrepreneurs in India are neither seen as comparable nor encouraged to be in the majority.
Current challenges as a female entrepreneur
A major challenge faced by women-led businesses in our country is the lack of capital due to investor bias and other factors. This is due to poverty, cultural barriers to property and land ownership, leading to lack of collateral for loans and limited employment in the formal sector. Running a business requires long hours and dedication, which puts women in conflict with family commitments, making them feel guilty for putting their business first. It takes a lot of encouragement in the form of mentors and an ecosystem/support system to run a business. A majority of businesses are male-dominated, making it difficult for women to gain introductions and connections into elite business networks. Women have always been confined to a supporting role, therefore, leading in the professional world becomes confrontational, causing rifts in the social lives of budding female entrepreneurs. As a result, leading in the professional world becomes confrontational, causing schisms in the social lives of aspiring entrepreneurs.
Entrepreneurial loan options for women
To support women in their entrepreneurial initiatives, from financial organizations to government schemes, there have recently been many types of business loans to help them:
Small business loans: Small business loans are available to startups and existing businesses. One such loan for women entrepreneurs is the line of credit. The eligibility of the applicant is checked and the women are then allowed to borrow money up to a maximum credit limit with certain documents. When repaying, they only have to pay interest on the amount used and not on the entire credit limit.
Business loan: This loan, ideal for a medium-sized company, can grant women a certain amount, for a period of up to three to five years. It does not require detailed documents. To be eligible, the business must be at least one year old and established. The applicant must submit the current account statement for a minimum of one year to the lender.
Loan against securities: Women can acquire this loan against investments in the stock market, mutual funds and life insurance policies. These are available for four to five years and require proof of title ownership, to be used as collateral.
Personal loan: Women who are planning to start a home business can apply for this loan. It is offered based on the financial stability of the applicant. An option to add a co-applicant to help increase eligibility makes it advantageous. It can be used both personally and professionally. Monthly income and credit score are requirements to determine the loan amount to be sanctioned.
Loan programs women can consider
The Indian government has set up loan schemes to help women get financial support for their entrepreneurial journey.
Mudra loan program for women: This program was launched to provide financial support to enthusiastic female entrepreneurs starting a new business in the form of a beauty salon, sewing workshop, coaching courses, etc. It does not require any security and has categories in which it can be applied. These are Shishu Loans for growing businesses, Kishor Loans for established businesses that want to improve their services, and Tarun Loans for well-established businesses that plan to expand.
Diagram of the Annapurnas: Women entrepreneurs who need loans for food catering businesses fall under this scheme. They use the borrowed amount for working capital, such as buying utensils, tiffin boxes, work tables, etc. Once approved, there is no IME for the first month. Only if sanctioned, the amount has to be repaid in 36 monthly installments. Interest rates are charged according to the market rate and the bank concerned.
Dena Shakti Diet: Women entrepreneurs in agriculture, microcredit, manufacturing, retail stores or small businesses can receive a loan from the Dena Shakti Scheme. A concession of 0.25% is granted on the interest rate.
The Hundred Kalyani Yojana: Self-employed women in micro-enterprises such as cottage industries, farming, farming and retailing are eligible for this scheme. No collateral is required and the interest rate depends on market rates. The loan must be repaid within seven years.
Today, our country boasts of successful businesswomen across the world. However, travel has never been easy. It is only when their families, investors and society consciously attempt to break down gender barriers that women can shine in the corporate world.