If you're planning to start or expand your business and want to know which government schemes for women entrepreneurs, actually put money in your hands, this article gives you the full picture. You'll leave with a clear understanding of 5 central government schemes designed for female entrepreneurs in India — what each one offers, who qualifies, and where to apply.
India has built a meaningful set of funding and support programmes specifically for women in business. The challenge isn't awareness — it's knowing which scheme fits your situation. That's exactly what we'll sort out here.
Why Government Schemes for Female Entrepreneurs in India Matter
Women-owned businesses in India have historically faced two structural barriers: limited access to formal credit and a lack of collateral. Government schemes for female entrepreneurs in India are designed specifically to address both.
These programmes — offered through central government ministries, the Ministry of MSME (Micro, Small and Medium Enterprises), and the Small Industries Development Bank of India (SIDBI) — provide concessional loans, credit guarantees, and skill support that a standard business loan does not. They don't replace a business loan. They work alongside one, often reducing your cost of borrowing or removing the collateral requirement entirely.
Worth noting several of these schemes are accessed through a bank or NBFC, not directly from a government portal. Understanding which ones, you apply for yourself and which your lender handles on your behalf will save you time.
The 5 Government Schemes That Can Actually Fund Your Business
1. Pradhan Mantri MUDRA Yojana (PMMY) — For Women Starting or Scaling Small Businesses
MUDRA — Micro Units Development & Refinance Agency — is arguably the most widely used government loan scheme for women entrepreneurs in India. You can get collateral free loans under PMMY from ₹50,000* to ₹20 Lakh*, depending on the stage of your business.
The scheme has 3 tiers:
- Shishu: Loans up to ₹50,000* — for businesses in the earliest stage or just starting out.
- Kishore: Loans from ₹50,001* to ₹5 Lakh* — for businesses that are operational and need growth capital.
- Tarun & Tarun Plus: Loans from ₹5 Lakh* to ₹20 Lakh* — for established businesses looking to expand.
You don't apply to MUDRA directly. MUDRA loans are disbursed through scheduled commercial banks, regional rural banks, microfinance institutions, and NBFCs. MUDRA loans are disbursed through scheduled commercial banks, regional rural banks, microfinance institutions and eligible NBFCs. If you are considering finance through an NBFC, it is worth asking whether your application can be assessed under the PMMY framework.
No collateral is required for MUDRA loans. That alone makes it one of the most accessible loan schemes for women in India, particularly for those who don't have property registered in their name.
Official resource: mudra.org.in
Related Reading: Explore Shriram Finance's guide on Pradhan Mantri MUDRA Yojana (PMMY) to understand eligibility, documentation, and how to apply.
2. Stand-Up India Scheme — For SC/ST and Women Entrepreneurs in Manufacturing or Services
Stand-Up India was introduced specifically to support at least one-woman borrower and one SC/ST borrower per bank branch. It covers greenfield enterprises — meaning businesses you are starting fresh, not expanding an existing one.
What the scheme offers:
- Composite loans from ₹10 Lakh* to ₹1 Crore*
- Coverage for manufacturing, services, or trading sector businesses
- Repayment tenure of up to 7 years* with a moratorium period of up to 18 months*
- Linked to SIDBI's credit guarantee support in certain cases
You must hold at least 51% stake in the business to qualify under this scheme as a woman applicant. The application goes through a scheduled commercial bank — you can also register your interest via the Stand-Up India portal before approaching a lender.
This is one of the few government schemes for female entrepreneurs in India that directly addresses greenfield manufacturing — worth considering if you're setting up a production unit or service facility from scratch.
Related Reading: Read Shriram Finance's detailed article on the Stand-Up India Scheme for a step-by-step breakdown of benefits and application requirements.
3. Udyogini Scheme — Subsidised Loans for Women in 88 Business Categories
The Udyogini scheme is run by the Women Development Corporation and is implemented through public sector banks and cooperative banks. It provides subsidised loans of up to ₹3 Lakh* to women from economically weaker sections at concessional interest rates.
Key eligibility points to know:
- Age: 18 to 55 years*
- Annual household income: below ₹1.5 Lakh* (varies by state implementation)
- No income limit for widows, destitute women, or those with disabilities
- Business must fall within the 88 approved categories — these include agarbatti making, tailoring, dairy, papad making, and other cottage or micro-scale activities
The interest subsidy varies depending on the category you fall into. Widowed and differently abled women entrepreneurs may receive higher subsidy components. Verification of the exact subsidy for your category should be done directly with your bank or the Women Development Corporation in your state.
Related Reading: Learn more in Shriram Finance's complete guide to the Udyogini Scheme.
4. CGTMSE — Credit Guarantee Fund Trust for Micro and Small Enterprises
The Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) is a lender-side guarantee scheme. Your lender (bank or NBFC) applies for the guarantee and CGTMSE guarantees a part of the loan in case of your default. This means you do not have to provide any collateral or third-party guarantee.
CGTMSE provides additional guarantee cover for women entrepreneurs - normally up to 90%* of the loan amount for loans sanctioned to women-owned MSMEs, within the scheme’s ceiling limits. The current maximum loan amount eligible under CGTMSE is ₹500 Lakh* (as per CGTMSE's published scheme details on cgtmse.in).
What this means for you: if your lender sanctions your loan under CGTMSE, you are not required to pledge property or assets as collateral. Ask your lender specifically whether your loan will be covered under CGTMSE — this is not automatic on all loans, and lenders apply based on their own eligibility assessment.
Important: CGTMSE operates between the lender and the guarantee institution. You cannot invoke it yourself after disbursement or in case of financial difficulty. If your loan was sanctioned under CGTMSE coverage, speak to your relationship manager about your options.
Related Reading: Read Shriram Finance's article on CGTMSE Loans to understand how the guarantee mechanism works and how it can help women entrepreneurs.
Looking for a business loan with flexible eligibility? Explore Shriram Business Loan →
5. Mahila Udyam Nidhi Scheme — For Women Starting Small Industrial Units
The Mahila Udyam Nidhi (MUN) scheme is primarily facilitated through SIDBI and implemented by various commercial banks for women setting up small-scale industrial ventures. It provides soft loans — at below-market interest rates — of up to ₹10 Lakh*, repayable over up to 10 years* with an initial moratorium of up to 5 years*.
Typical eligibility requirements:
- The enterprise must be in the small-scale sector
- The woman entrepreneur must hold a controlling stake in the business
- The business must be new or in its early expansion phase
- Applications are typically channelled through PNB branches or SIDBI regional offices
The long moratorium period — up to 5 years* before repayments begin — makes this scheme particularly useful if you're setting up a unit that will take time to generate stable revenue. It gives you breathing room to invest in infrastructure before cash flows stabilise.
Related Reading: Explore Shriram Finance's detailed guide to the Mahila Udyam Nidhi Scheme to understand its benefits and eligibility criteria.
Considering a business loan?
Shriram Finance Business Loan offers funding solutions for women entrepreneurs across manufacturing, trading and service sectors. If you are exploring government-backed schemes such as PMMY or CGTMSE, speak to your relationship manager to understand whether your application may be structured under an eligible framework.
Which Scheme Fits Your Situation — A Quick Decision Guide
Use this table as a starting point, not a final answer. Eligibility within each scheme can vary based on your business type, income, and the specific bank or NBFC you approach. Always verify current terms on the official scheme portal before applying.
Application Checklist — Before You Approach Any Lender
The process for applying for the scheme will be different depending on whether you are applying for the scheme directly or through a lender. Here’s how both processes work:
- For MUDRA loans: Approach a scheduled bank, regional rural bank or NBFC directly and tell them that you want a loan under the PMMY framework. They will explain their own documentation process.
- For Stand-Up India: Register your interest on standupmitra.in and approach a scheduled commercial bank branch with your business plan and documents.
- For Udyogini: Approach a public sector bank or Women Development Corporation office in your state. The availability of this scheme varies according to the state, so check with your local branch first.
- For CGTMSE-backed loans: You don't apply to CGTMSE yourself. When you apply for a business loan from an eligible lender, ask whether they offer CGTMSE-covered loans for MSMEs. The lender will apply for the guarantee on your behalf.
- For Mahila Udyam Nidhi: Apply through PNB branches or SIDBI regional offices. Carry your business plan, identity documents, and any registration certificates that you have.
Documents You’ll Usually Need Under These Schemes
Exact document requirements vary by scheme and lender, but most government schemes for women entrepreneurs in India require a common set of documents:
- Identity proof: Aadhaar card, PAN card, voter ID, or passport
- Address proof: Aadhaar, utility bill, or ration card
- Proof of business ownership or registration: Udyam Registration certificate (from udyamregistration.gov.in), shop establishment certificate, or GST registration
- Proof of business category where applicable: for Udyogini, your business must fall in the approved list
- Income proof: bank statements for the last 6 to 12 months, or ITR (Income Tax Return) if filed
- Passport-size photographs
- Caste certificate for SC/ST applicants under Stand-Up India
Get your Udyam Registration done before you approach any lender — it establishes your MSME status and is required for CGTMSE coverage and several other schemes. Registration is free at udyamregistration.gov.in.
When a Government Scheme Isn't Enough — How Shriram Business Loan Can Help
You now have a clear picture of the top 5 government schemes for women entrepreneurs in India — what each one covers, who it's designed for, and how to access it. The right scheme depends on your business stage, your sector, and the amount you need.
If your funding need goes beyond what a government scheme can offer, or if you need quicker access to working capital, a Shriram Finance Business Loan can complement your financing plans. If your enterprise is registered as an MSME, you may also explore Shriram Finance MSME Loan options.
Frequently Asked Questions
What documents are required to apply for government schemes for women MSMEs?
You'll need identity proof (Aadhaar or PAN), address proof, Udyam Registration certificate confirming your MSME status, 6 to 12 months of bank statements, and business registration documents such as a shop establishment certificate or GST certificate. For Stand-Up India, include your business plan. For Udyogini, you may need income proof showing your household falls within the scheme's income ceiling. Check the specific scheme portal for the complete list, as lenders sometimes ask for supplementary documents based on their own credit assessment.
How can women apply for these government schemes?
It depends on the scheme. MUDRA loans are applied for through a bank or NBFC — you don't apply directly to MUDRA. Stand-Up India has a dedicated portal at standupmitra.in where you can register before approaching a bank. For CGTMSE-backed loans, your lender applies on your behalf — you simply need to ask whether their loan product is CGTMSE-covered. Udyogini applications go through public sector banks or Women Development Corporation offices in your state. Mahila Udyam Nidhi applications go through PNB or SIDBI regional offices.
Can women entrepreneurs apply for government subsidies under these schemes?
Yes — several of these schemes include subsidy components, though the availability and percentage depend on the scheme and your eligibility. The Udyogini scheme offers interest subsidies, particularly for widowed or differently abled women. Stand-Up India loans may attract interest rate concessions offered by the lending bank. MUDRA itself does not offer a direct subsidy, but because it is structured as a collateral-free loan, it reduces your cost indirectly. Always confirm the subsidy component with the lender or scheme authority before you apply, as terms are updated periodically.
How can a woman start her own business in India?
Start by registering your business — this can be as simple as a sole proprietorship (no formal registration required, though a trade licence or GST registration helps) or a private limited company registered with the Ministry of Corporate Affairs. Get your Udyam Registration at udyamregistration.gov.in to access MSME-linked schemes and benefits. Then identify which government scheme fits your business stage and type — MUDRA for micro-scale, Stand-Up India for greenfield manufacturing, and so on. Open a current account in your business name and maintain bank records from day one. If you need capital beyond what a government scheme provides, a business loan from Shriram Finance can bridge the gap, with loan amounts and terms suited to your business profile.
Which business is most profitable in India for women?
Profitability depends on your location, skills, and the capital you can access — but certain sectors have consistently worked well for women entrepreneurs in India. Food processing and catering businesses benefit from MUDRA and Udyogini access. Home-based manufacturing — agarbatti, pickles, handloom, or handicrafts — has low startup costs and clear government support. Service businesses like tailoring, beauty services, and early childcare tend to have steady local demand in Tier-2 and Tier-3 cities. If you're looking at a higher investment, retail, logistics support, or agricultural supply chain businesses can be strong options with working capital financing. The best business for you is one where your experience meets real local demand — government schemes help you fund it, but the fit between your skills and the market is what drives profitability.