Viewpoint

Let's first dive into the world of women-led MSMEs in India. The sectors they are most present in include textiles, handicrafts, food and grocery retail, jewelry and accessories retail, beauty salons, and eateries.

Largely unorganized, 20% of India's 6 crore plus MSMEs are led by women. From 2011 to 2021, the number of women entrepreneurs in India have grown from 2.15 lakh to 1.23 crore. This is still a low number, and the reasons for this are many.

• Women face greater challenges in accessing finance and building network.
• Women face general lack of safety in markets and public spaces.
• The female literacy rate in India is at 65.46% compared to 74% male literacy rate. Lack of education limits women from managing capital and investment required for running a business.
• Women are less likely to obtain capital to invest in their business due to cultural reasons.
• Lenders are conservative to give credit to women.
• Some women find it difficult to continue business due to lack of family support, child-care options etc.

Most female entrepreneurs therefore rely on informal sources of financing. Data suggests that 79% of women-owned enterprises are self-financed. Only 4.4% of the enterprises are currently government-funded.

To increase the share of women-led MSMEs, many schemes and policies have come into being. Let’s look into some of these:

1. Stand-up India Programme: Launched in 2016, this scheme allows for lenders to lend to one woman borrower per bank branch for setting up an enterprise in manufacturing, services or trading. Over 1.43 lakh applications for over Rs. 34,076 crores have been received so far, with 1.25 lakh applications being sanctioned.
2. Annapurna Scheme: This loan is provided for women in the food catering industry. The loan provided under this scheme allows women to buy equipment, utensils, to set up food trucks etc. Using the loan from this scheme women can sell packed food items and snacks. Up to Rs. 50000 can be used with this scheme, to be paid off in 3 years.
3. Mudra Yojana Scheme: This scheme improves the status of women in the country through providing business loans. The objective of this scheme is to help women be financially independent and self-reliant. Women will be provided with Mudra cards that work like credit cards and can withdraw 10% of the loan. With many different tiers of plans, the loan limit is Rs. 10 lakhs. This scheme also does not require any collateral to grant the loan.
4. Stree Shakti Loan Scheme: This is a loan scheme to find and support entrepreneurship among women. If the business has more than 50% share capital owned by women, the Stree Shakti Loan Scheme allows for Rs. 20 lakhs of loan. This scheme has supported women in textile industry, dairy, blanket making, production and sale of food products, incense, soap and detergent etc. With lowered interest rates, this is a very attractive plan for women-led MSMEs.
5. Central Bank of India, Cent Kalyani Plan: Women running rural business related to farming, retailing, cottage industries etc. are eligible for this plan. A loan up to Rs. 100 lakhs can be sanctioned via this plan, with no processing charges on the loan amount. No collateral security or third-party guarantee is required, and there is a lower interest rate.

In the second part of this Women's Day special series, ViewPoint will dive into some more schemes for women entrepreneurs, as well as discuss what sort of social media, digital commerce and new technology women-led MSMEs can use to grow their business and develop their digital literacy.