The 21st-century India is all about women empowerment. It is a good time for women to redefine gender stereotypes and make their dreams come true. The Indian Government has further promoted this move towards empowerment by launching special subsidy schemes, such as the Stand Up India, a Scheme for prospective SC/ST/women entrepreneurs. It came into effect on April 16, 2016.
Here are some features of this scheme, which makes it an ideal launching pad for women entrepreneurs.
- Ready availability of capital
Before the launch of the scheme, most women could not secure the necessary funds to start their business. According to a survey published by the Global Entrepreneurship and Development Institute, 73% of prospective women could not initiate their companies in India as potential investors rejected their claims.
With limited sources of business finance, women entrepreneurs failed to create an impact in India. However, this new scheme is one of the great sources of financing for women for any Greenfield project. Loan amounts range between Rs. 10 Lakh to Rs. 1 Crore.
- Finance for start-ups
Apart from financing new businesses, the Stand Up India Scheme offers financial assistance for companies that are still considered as start-ups. With this scheme, women can opt for refinancing through the Small Industries Development Bank of India. The refinancing option aids struggling businesses to remain solvent.
- Quantum of loan
The money lent will cover 75% of the composite cost for your project. Therefore, if you need Rs. 20 Lakh to start a business, the loan received under the scheme will cover Rs. 15 Lakh of the total cost. However, to ensure 75% cover of the entire project, you must ensure that the funding from your side or other schemes does not exceed 25% of the total cost.
- Rate of interest
Stand Up India scheme ensures a business loans for women most at attractive interest rates. The rate of interest for the loan will be the lowest rate offered by that particular NBFC on its business loan products. Additionally, the interest charged should not exceed the total of the tenor premium plus 3% and Marginal Cost to Fund based Lending Rate or MCLR.
- Flexible tenor
Women entrepreneurs availing loans under this scheme can rest easy knowing they can choose an appropriate loan tenor as per their repayment ability. You can repay such loans within 7 years. You can pick a moratorium period up to 18 months for a loan under this scheme.
The Indian Government has set this scheme up in such a manner that each branch of the NBFCs and other Scheduled Commercial Banks in the country must sanction at least two such Stand Up India loans.
Stand Up India eligibility
Now that you know the various benefits of opting for a business loan under Stand Up India, here are some of the requirements you must match to benefit from this scheme.
- You must be over 18 years of age
- Your business must be a Greenfield project. Greenfield projects are entirely new businesses that do not involve remodelling or restructuring of an older organisation.
- 51% of the stakeholder in a non-individual company must be held by women for the business to be eligible for availing loans under this scheme.
- You should not have a history of default at the time of loan application.
If you are looking for sources of business finance to scale your dream venture and meet all of the requirements mentioned above, apply for the loan today. This scheme is one of the best ways to arrange business loans for women.