Women’s entrepreneurship is a powerful economic driver both at the individual level, and at the community level. Supporting women entrepreneurs in India leads to greater economic growth, job creation, and social equity, as women are more likely to reinvest earnings into their families and communities.
India can unlock significant untapped potential in its economy if more women entrepreneurs were able to gain access to and participate in the formal economy. In fact, according to Bain & Co., if women’s entrepreneurship is properly facilitated in India, it can create over 150-170 million jobs by 2030. One of the most potent catalysts that can enable the growth of women entrepreneurs is access to formal capital. However, women entrepreneurs often find it difficult to get capital for their businesses. According to IFC, about 90% of women entrepreneurs in India have not accessed formal financing from financial institutions, thus indicating a significant gap.
Interest in entrepreneurship has been on the rise, and we’ve seen the rise of platforms like Shark Tank, which have mainstreamed the concept of taking a risk and commercializing innovative ideas in various ways. For the millions of women entrepreneurs in the country who have the determination to take their businesses to the next level, but lack access to adequate capital, there are some great options available.
Here are a few programs that support women entrepreneurs with access to formal capital.
Stand-Up India Scheme
Launched by the Ministry of Finance, Standup India is one of the leading schemes focused on encouraging entrepreneurship among women by facilitating access to formal capital. The scheme offers composite loans (inclusive of term loan and working capital) in the range of Rs. 10 lakhs and Rs. 1 crore for setting up greenfield ventures (first-time ventures) across manufacturing, services, agri-allied activities, and trading. To be eligible for the scheme, the applicants should be at least 18 years of age, should not be in default to any bank or financial institution, and the enterprise should be the applicant’s first venture. The scheme also promotes entrepreneurship among Scheduled Castes (SC) and Scheduled Tribes (ST). The loan is repayable over seven years, with a maximum moratorium period of 18 months. The scheme has been instrumental in supporting many women entrepreneurs. The number of loan accounts held by women entrepreneurs under the scheme has increased from 55,644 in November 2018 to around 2 lakh reflecting the significant impact of the scheme.
HerVikas MSME Program
Kinara Capital has been at the forefront of driving financial inclusion of MSME entrepreneurs. HerVikas is an exclusive discount business loan program from Kinara Capital aimed at accelerating the advancement of women MSME entrepreneurs. HerVikas offers discounts on business loans in the range of Rs. 50,000 to Rs. 30 lakhs to women-owned MSMEs. The key highlights of the HerVikas program are a 60-day repayment holiday, up to 1% interest rate discount, and a 50% reduction in processing fees.
The loans are available to women MSME entrepreneurs across 300 MSMEs sub-sectors in manufacturing, trading and services, in more than 100 cities. Powered by AI/ML-based credit decisioning, the program assesses creditworthiness based on the overall health of the business, instead of just the credit score. The fully automated process ensures fast and unbiased access to business loans for women entrepreneurs. New MSMEs can apply for the HerVikas Startup Loan within 1 month of their Udyam Registration and can avail loans in the range of Rs. 50,000 to Rs. 5 lakhs with the same benefits. Kinara Capital has disbursed more than Rs. 1,000 crores through HerVikas business loans, which has enabled women entrepreneurs to achieve a 13% increase in the monthly net income of their businesses and to sustain over 46,000 jobs in local economies.
Cent Kalyani from Central Bank of India
Cent Kalyani is a special scheme from the Central Bank of India to cater to the business needs of women entrepreneurs, enabling them to generate continuous and sustainable employment opportunities. The scheme offers loans or credit facilities of a maximum of Rs. 1 crore to women entrepreneurs, working capital loans, term loans, and non-fund-based credit to meet various needs, including business expansion, working capital requirements, purchase of machinery, and development of business-related infrastructure. The scheme offers loans or credit facilities of a maximum of Rs. 1 crore. Women entrepreneurs who are planning to start a business or looking to expand their existing MSME unit can apply, provided the business unit complies with the MSME Act, 2006. Under the scheme, 20% of the project funding must be contributed by the entrepreneur. A key feature of the scheme is that it offers a maximum tenure of 84 months, including a moratorium of 6 months. Further, no collateral or third-party guarantee is required as advances are covered under the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE).
She Capital Fund
She Capital is an early-stage venture capital fund dedicated to investing in high-growth women entrepreneurs at the Seed, Pre-Series A, and Series A stages. The fund’s mission is to close the gender gap in entrepreneurship by providing women founders with capital, mentorship, and a supportive community. Apart from funding, She Capital also fosters a community of over 10,000 female founders in India. It provides a platform for networking, knowledge sharing, and support. Currently, the community has 10,000+ members. Some of the notable women-led startups that She Capital has backed are BrainSightAI (science‑tech) and the sports‑tech venture Yuva Kabaddi.
Mahila Udyam Nidhi Scheme
The Mahila Udyam Nidhi Scheme by Punjab National Bank, launched under SIDBI’s guidance, empowers and encourages women to generate income through activities in manufacturing, services, trading, small businesses, and more. It offers loans of up to Rs. 10 lakhs for setting up new projects in the tiny or small-scale sector and for rehabilitating viable sick SSI units. The scheme also supports existing tiny and small-scale industrial units and service industries undertaking expansion, modernization, technology upgradation, or diversification, enabling women entrepreneurs to grow and strengthen their businesses. The scheme is open to women or enterprises wherein women hold at least 50% financial stake. To apply for a loan under the scheme, the applicant must not be a defaulter to any bank or financial institution and must not have availed of loan facilities under government-sponsored schemes. One of the unique features is that for term loans, the scheme offers a repayment period of 3 to 5 years with a maximum moratorium of 3 to 6 months, depending on the type of activity and income generation. For overdrafts, the limit is sanctioned for three years, with annual reviews and renewal every three years.
While these programs are a great boon for women entrepreneurs, a significant gap in access to formal capital still exists. According to the IFC, women-led MSMEs in India face a credit gap estimated at USD 158 billion. The criticality of bridging this gap can’t be overstated. Data from Bain & Co. shows that India needs to add approximately 145 million women to its workforce by 2047 to achieve its goal of a $30 trillion GDP. Given the right resources, women entrepreneurs have the potential to significantly accelerate the progress of the economy. When women entrepreneurs thrive, they also create jobs and reinvest in their families and communities, transforming the socio-economic fabric of the nation.
