The Government of India actively encourages women to expand their entrepreneurial ventures. Although women currently contribute to 7% of the MSME (Medium, Small, and Micro Enterprises) sector, the growth potential is immense. Under the MSME scheme several banks and NBFCs now offer easy business loans for women, featuring minimal paperwork, no security, and lower interest rates. To encourage their participation in MSME, we have rounded up all the details about how to apply for business loans for women in India.
Step-by-Step Guide
Here are the steps as a guide to learning how to apply for an MSME loan for women:
- Step 1: Go to the Chosen Lender’s Official Website
First off, you should head over to the lender’s official website. Always keep in mind that there are many lenders available in today’s digital landscape. You should choose a reliable and trustworthy lender to prevent the issue of any future disputes. - Step 2: Check Your Business Loan Eligibility Criteria
Then, you should check the business eligibility criteria to ensure whether or not you are eligible for a business loan. Check women’s business loan eligibility criteria, outlined below: - The prospective loan applicant’s age should be between 18 years and 65 years
- The applicant should be the owner of 51% of the share in the business in case the business falls under the category of partnerships or corporations
- The business of the loan applicant should be in active mode. This should have been operational for about 1-3 years and currently generates a good income
- Women applicants who are eligible for the government loan scheme Stand Up India can apply for the business loan.
- Step 3: Apply with Uploading Documents
Once you confirm that you are entitled to a business loan, you should move one step ahead. All you need to do is upload all mandatory documentation (i.e. photographs, personal, business, and income proofs). This step ensures easy loan approval. - Step 4: Get a Loan Offer
Then, the authorized team will evaluate your uploaded documents and verify them. This may take up to 24 hours. Once the team verifies your documents, you will get a call to know the fair amount of the loan. - Step 5: Send the Signed Loan Agreement with Vital KYC Documents
Thereafter, you should send a signed loan agreement to the lender with essential KYC documents. This is a crucial step in every loan application procedure. By sending a signed loan agreement, you confirm that you have accepted all the terms and conditions of the lender. - Step 6: Check the Funds in Your Bank Account
Finally, the lender will initiate the funds to your bank account. Keep checking your bank messages and use funds to grow your business.
Documents Required
You can avail of the benefits of business loans for women in India once you have successfully uploaded documents. Upload the mandatory documents that are listed below:
- Duly filled online loan application form along with recent passport-size photographs
- ID Proofs: AADHAR card, PAN card, driving licence, and passport
- Address Proofs: Voter’s ID, ration card, Aadhar card, passport, driving licence, and rent agreement
- Last six months’ bank statement
- Certified profit and loss statement
- ITR statement
- Business balance sheet for the last years.
End Note
Here’s hoping this guide will help you understand how to apply for business loans for women. Participation of women entrepreneurs in MSMEs is significantly important not only for the society but the economy as well. Women entrepreneurs are breaking the stereotypes. In today’s economic landscape, where there are endless opportunities to grow and thrive, Lendingkart, a reliable digital lending platform, offers easy and convenient loan disbursal to all its customers, empowering them to succeed as entrepreneurs.
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