10 Types of Loans for Women-Owned Business

Introduction: 

There exist a wide range of business models that operate in the country today. India offers countless opportunities to business enthusiasts. Women, in particular, can take advantage of the fact that there exist a number of business loans for women entrepreneurs. In fact, lenders are often eager to offer women these loans such that they can attain success in their endeavours. 

Continue reading to understand what a woman-owned business loan is and the forms it takes.

Defining a Woman-Owned Business Loan

A woman-owned business loan refers to a loan that is geared towards helping women entrepreneurs acquire the financing they need in order to start or expand upon their businesses. There exist a number of lenders that offer these loans and they can be used to serve a wide range of needs.  

Assessing the Varied Types of Loans for Women-Owned Businesses

The most popular business loans for women entrepreneurs are as follows. 

1. Commercial Real Estate Loan –

This kind of loan can be used to expense a renovation, expansion or to purchase a new property for your business.

2. Equipment Loan –

With this loan, it is possible to avail of new or used equipment that is needed by your business.

3. Invoice Factoring and Invoice Financing –

Here, financing options are made available depending upon the outstanding invoices you have. These loans are designed to provide you with cash immediately. 

4. Line of Credit –

This form of loan functions in a manner that is similar to a credit card as it permits you to borrow as much money as you need, up to a certain limit. Businesses that require short-term financing to address their working capital or inventory requirements can use it.

5. Merchant Cash Advances –

Here you can be financed with a lump sum of cash in lieu of a percentage of your future sales. 

6. Microloans –

Community based organisations are known to issue these loans that are small in nature. They can be used to finance inventory or working capital.

7. Peer-to-Peer Lending –

Rather than traditional financial institutions, these business loans are provided by individuals.

8. SBA Loans –

Small business administration offers these loans and provides borrowers with benefits that range from long terms to low-interest rates.

9. Term Loan –

This kind of loan features a fixed repayment schedule that has a predetermined interest rate that also remains fixed. As a woman entrepreneur, you can use a term loan to finance several expenses ranging from purchasing new equipment to growing your business operations. 

10. Government Loans –

The government of India provides women entrepreneurs with a host of business loans that are designed to help them succeed. They include but aren’t limited to the following. 

• Annapurna Scheme – This loan is meant to help women entrepreneurs operating within the food catering industry and a sum of up to Rs. 50,000 is offered here. 
• Bhartiya Mahila Bank Business Loan – This is a public sector banking company that offers women business loans that amount to up to Rs. 20 Crores. 
• Cent Kalyani Scheme – New women entrepreneurs, as well as those who have experience in the world of business, can avail of this loan.
• Dena Shakti Scheme – Women can avail of loans of up to Rs. 20 Lakhs here provided their business model is relevant to agriculture, micro-credit, a retail store, manufacturing or is a small enterprise.
• Mahila Udyam Nidhi Yojana – Small scale ventures owned by women can benefit from this scheme that offers loans amounting to up to Rs. 10 lakhs. 
• Mudra Loan for Women – Women entrepreneurs hoping to start businesses can avail of this loan which ranges from Rs. 50,000 to Rs. 10 Lakhs. 
• Stree Shakti Yojana – Certain concessions are provided to women business owners under this loan. 
• Udyogini Scheme – This loan encourages the spirit of entrepreneurship among poor women. 

Wrapping Up

Now that you have understood what women-owned business loans are, you as a woman should not hesitate to apply for a business loan online. These loans are designed to empower you and make you financially independent.