India’s growing MSME sector is a budding ground for women entrepreneurs. Women-owned businesses have flourished over the past decade, boosting the country’s overall economic growth. However, according to a report published by the Ministry of Statistics and Program Implementation, female entrepreneurs comprise only 13.76% of the total entrepreneurial count. This translates to roughly 8 million as opposed to the 50 million plus male entrepreneurs.
This skewed entrepreneurial landscape can be tied to several reasons, including gender bias, a shortage of credit options for female entrepreneurs, and a lack of supportive infrastructure. Several MSME schemes offer easy business loans for women to simplify access to credit and empower them. The Dena Shakti Scheme is one such scheme that’s empowering Indian women to embark on their entrepreneurial journeys and grow their ventures.
What is the Dena Shakti Scheme?
The Dena Shakti Scheme is designed to empower women entrepreneurs with affordable and easy access to financial assistance. Managed by the Dena Bank, this scheme eliminates business loan complexities to help women entrepreneurs secure funding to grow their business ventures. The primary objective of the scheme is to support women entrepreneurs financially. Under the Dena Shakti Scheme, women entrepreneurs involved in agriculture, retail trade, housing, education, and SME sectors can avail of small business loans for women business loans of up to Rs. 20 Lakhs at concessional rates to raise working capital or expand their operations.
The Dena Shakti Yojana offers business loans for women with relaxed loan terms, nominal interest charges, and sufficient loan amounts. Here’s a quick overview of the Dena Shakti Scheme details:
| Dena Shakti Scheme Overview | |
| Rate of Interest | 0.25% lower than base rates (applicable for female entrepreneurs who hold majority stakes in the business) |
| Maximum Loan Amount for Agriculture | Rs. 20 Lakhs |
| Maximum Loan Amount for Retail, Manufacturing, and Small Enterprises | Rs. 20 Lakhs |
| Maximum Loan Amount for Microcredit | Rs. 50,000 |
| Loan Tenure | Maximum of 7 years |
| Processing Charges | 0.50% of the loan amount |
Also Read: Udyogini Scheme for Women Entrepreneurs
Sectors Covered Under the Dena Shakti Scheme
The Dena Shakti Scheme covers many sectors, empowering women entrepreneurs to carve a niche in different business fields. Women entrepreneurs operating in the following sectors can secure a Dena Shakti business loan for their small businesses:
- Agriculture and Allied Activities
- Retail Trade
- Small Enterprises
- Micro and Small Manufacturing Enterprises
- Micro and Small Service Enterprises like business professionals, self-employed women, etc.
- Housing
- Education
- Micro Credit
Details About Small Business Loan
The maximum loan amount sanctioned under this Scheme varies depending on the sector in question. Women-led enterprises in priority sectors like agriculture can secure business loans of up to Rs. 20 Lakhs. Similarly, for the manufacturing, retail trade, education, and housing, the loan ceiling is set at Rs. 20 Lakhs.
Microfinance is one of the most effective tools to promote entrepreneurship among women. These business loans help alleviate the financial assistance obstacles women entrepreneurs face. The Dena Shakti Scheme also offers business loans for small businesses with its micro-credit loan facility. Women-led small businesses can secure up to Rs. 50,000 to fund their micro-credit requirements.
Eligibility Criteria and Documents Required for the Dena Shakti Scheme
To avail of a Dena bank loan business loans for women, female entrepreneurs need to meet certain important eligibility parameters. The MSME loans for women under the Dena Shakti Scheme are available to women with more than 50% ownership in the business enterprise. Moreover, these loans are also available to self-employed professional women like chartered accountants, architects, and doctors.
To simplify the business loan application process loan scheme for women, the Dena Shakti Scheme requires the following basic documents from the applicant:
- Identity proof documents like Aadhaar Card/PAN Card/Driving Licence/Voter’s ID Card
- Address proof documents like Aadhaar Card/Passport/Ration Card/Utility Bills
- Bank account details
- One passport-sized photograph of the applicant
Also Read: UIDAI – Unique Identification Authority of India
Dena Shakti Application Form
To apply for the Dena Shakti business loan, you need to obtain the application form from the MSME branch of the Union Bank of India. This form requires detailed information, and here are the key points you need to complete when applying for this scheme:
- Enterprise Details: Provide the full legal name of your business along with the complete address. This ensures that the bank can accurately identify your enterprise and contact you if needed.
- Category: Mention whether your business falls under any special categories such as Scheduled Tribe, Scheduled Caste, or Minority. This is important as it may make your business eligible for specific benefits under the scheme.
- Email Address: You need to provide a valid and functional email address, as this will be used for any communication related to your loan application.
- PAN Number: Include your business’s PAN (Permanent Account Number) to verify the identity of your enterprise and its financial records.
- Constitution of the Enterprise: Clearly specify the legal structure of your business, whether it is a private limited company, partnership firm, limited liability company, sole proprietorship, or a cooperative. This helps the bank understand how your business is organised.
- Date of Establishment: This is the date your business was formally set up. It helps the bank determine the age of your business, which can affect the loan approval process.
- Partners, Directors, or Proprietors’ Details: You will need to provide the full names, addresses, and PAN numbers of all key people involved in your business, including partners, directors, or proprietors.
- Loan Information: Clearly state the loan amount you are requesting along with any additional details about how the funds will be used. This section helps the bank assess your financial needs and decide how much they can lend.
- Collateral Security Information: If you are offering any collateral for the loan, such as property or assets, provide the details here. If your business qualifies for a collateral-free loan, this section may not apply.
- Credit Card or Banking Details: Include details of your business’s existing credit cards and bank accounts. This helps the bank evaluate your business’s financial history and determine your creditworthiness.
How To Apply for Shakti Scheme?
To apply to the Dena Shakti Scheme, the applicant must visit the nearest Dena bank and get the application form from the bank office. After that, the applicant needs to fill in the necessary details in the application form and submit it with the relevant documents.
Understanding the Impact of the Dena Shakti Scheme on Women Entrepreneurs
The Dena Shakti Scheme aims to create a diversified entrepreneurial landscape, empowering women to grow and expand their business ventures. Here’s how the Dena Shakti Scheme benefits women entrepreneurs:
1. Concessional Interest Rates:
The Dena Shakti Scheme offers financial assistance at a concessional rate to women-led businesses, lowering the average cost of borrowing. Women entrepreneurs can secure business loan for women at a concession of 0.25% on the prevailing interest rates. The reduction in interest rates provides a significant competitive advantage. It enables women to allocate more resources toward business expansion. It also makes it easier for women-owned businesses to maintain sustainable cash flow while managing loan repayments. This helps women entrepreneurs invest in business growth and development without being burdened with high interest charges.
2. Working Capital-Cum-Term Loan:
Recognising the diverse funding requirements of women entrepreneurs, the Dena Shakti Scheme offers a working capital-cum-term loan. This approach allows women entrepreneurs to have funds to meet their short-term capital requirements for day-to-day business operations and long-term capital for business expansion and growth. Plus, this dual nature of funding can act as a safety net. It provides flexibility to handle unforeseen expenses or market changes. This can help entrepreneurs to focus on both operational stability and strategic growth. This flexible financial assistance helps women manage their working capital and seize opportunities for scaling their businesses without liquidity constraints.
3. Comfortable Repayment Tenure:
The Dena Shakti business loans for women come with a flexible repayment tenure ranging up to 7 years. This prolonged repayment time frame eases the burden on women entrepreneurs, allowing them to plan repayment schedules that align with their cash flow dynamics. A longer tenure allows women entrepreneurs to reinvest their earnings into their businesses rather than focusing heavily on short-term loan repayments. This structured repayment process enhances their ability to grow their business sustainably over time. Moreover, a longer repayment tenure allows them to pace out EMIs, reducing monthly financial strains and liabilities.
4. Fostering Growth with Microcredit:
The micro credit finance aspect of the scheme helps establish and grow small businesses. Statistics suggest that women entrepreneurs dominate the low capital-intensive micro-business landscape, especially in the rural sector. This focus on micro-businesses ensures that even women in remote or underdeveloped areas have access to formal financial services. It closes the gap between rural and urban entrepreneurship. Microcredit enables these businesses to contribute significantly to local economies while fostering innovation in their communities. Microcredit offers targeted financial assistance to small enterprises that are often unable to secure finance from traditional credit sources. This promotes economic growth and independence at the grassroots levels and contributes to the empowerment of women entrepreneurs.
Conclusion
The Dena Shakti Scheme is one of the many initiatives designed to empower women entrepreneurs, paving the way for a more diversified and balanced entrepreneurial landscape. By offering business loans to women entrepreneurs from a cross-section of sectors against concessional interest rates and favourable loan terms, the Scheme aims to alleviate the credit constraints to establishing and growing women-led businesses.
It plays a pivotal role in promoting financial inclusion and encouraging women to venture into new industries. As more women access this support, this scheme contributes to building a solid ecosystem of female entrepreneurship in India.
Lendingkart also supports women entrepreneurs by providing Women business loans. These flexible loans for women entrepreneurs are tailored to the specific needs of your business. With minimal documentation and quick disbursal, Lendingkart makes it easier for women to secure the capital required for growth.
Frequently Asked Questions
What Are The Objectives Of Dena Shakti Scheme?
The Dena Shakti Scheme focuses on promoting entrepreneurship among women with affordable finance options. The Dena Shakti Scheme aims to empower women entrepreneurs involved in a range of sectors – from agriculture to MSMEs. The Scheme offers hassle-free business loans to women entrepreneurs to help them establish and grow their ventures.
Does The Dena Shakti Scheme Offer Interest Rate Concessions?
Yes. Women-led businesses can secure a Dena Shakti loan with a 0.25% concession on the base interest rate.
What Are Eligibility Criteria For A Dena Shakti Business Loan?
All female entrepreneurs with over 50% stake in the business are eligible for a Dena Shakti business loan.
Does The Dena Shakti Scheme Offer Microcredit?
Yes. The Dena Shakti Scheme also offers microcredit loans up to Rs. 50,000. Women entrepreneurs can secure such business loans for their small businesses to raise working capital or expand operations.
