Udyogini Scheme

In the beginning.

Udyogini was introduced by the World Bank in 1992 as a campaign for the economic empowerment of Indian women. 

They initially acted as a service provider, supplying NGOs and government agencies with technical assistance and resources. An initiative spearheaded by Ms. Ela Bhatt, founding member of the Self-Employed Women’s Association (SEWA). 

After 20 years, they have grown into the organization they are today. They are experts in job creation, and entrepreneurship, and have improved the quality of life for thousands of rural residents across many sectors. The youth has been given a voice, a chance to make a difference and to change their own lives. Their efforts have made a positive difference to more than 200,000 people. 

Their operations are currently spread across five states – including Chhattisgarh. Madhya Pradesh. Uttarakhand, Jharkhand, and Rajasthan.  In lieu of this scheme, more than 50,000 women and youth are working for multiple MSMEs today. 

Banks that facilitate this scheme:

There are several banks and NBFCs that offer the Udyogini Scheme, including Karnataka State Women’s Development Corporation (KSWDC), Punjab and Sind Bank, and Saraswat Bank, as well as several other private and public sector banks. 

Objectives:

Women entrepreneurs from marginalized areas of the country will be able to benefit from this program via low-interest loans. This program offers monetary assistance to women who want to become entrepreneurs, self-sufficient, and financially independent. 

Eligibility:

Applicants under the age of 55 who are aspiring women entrepreneurs are eligible for this scheme. The applicant’s annual income must not exceed 1.5 lakhs. 

• No upper limit on income for women falling under special categories like disabled, widowed or destitute. 

• Can be availed by businesses engaged in SSI sector, retailers, manufacturers, self-employed professionals, traders, etc. 

How does the Udyogini scheme work?

By implementing the Udyogini program, the goal is to enhance women’s entrepreneurial capabilities through customized loans offered in rural or less developed parts of India.  

The steps involved in such a scheme are as follows: 

• Business training and customized services are provided to women from underserved areas. 

• Upon sanctioning adequate funding, increased production becomes the priority 

• An increase in income from business operations 

• Proactive participation of women in decision-making 

Features: 

•  As long as applicants meet the eligibility standards set by, they can receive up to 3 Lakhs for their businesses. 

• Since the launch of this initiative, more than 88 small and medium businesses have benefited. To name a few: fisheries, bakeries, grocery stores, libraries, matchbox manufacturing, poultry, and dairy business.  Women can also obtain loans for agriculture sectors. 

• Besides financial assistance, this program provides all the skills related to the implementation of a business, financial planning, market research, etc. 

• Providing 30 percent of the loan amount as a subsidy makes repayment affordable for borrowers. 

• Transparent assessment of selection is assured through this scheme.  

Interest Rates: 

 Every financial institution has different loan repayment terms and interest rates. A few example terms are given below: 

Udyogini Scheme from Saraswat Bank

• The interest rate is 11.15 percent onwards for all the three sectors 

Sum of loan: 

•  Micro Enterprise:  Up to 2 Lakhs 

•  Small Enterprise: From Rs. 2 to Rs. 50 Lakh  

• Medium Enterprise: From Rs. 50 lakh up to Rs. 100 lakh 

Processing fee: 

•  Micro Enterprise:  Rs. 5000 

•  Small Enterprise: Up to Rs. 10 Lakh – Rs. 5000/ Above Rs. 10 Lakh and up to Rs. 25 Lakh – Rs. 7000 / Above Rs. 25Llakh – Rs. 10000 

•    Medium Enterprise: Up to Rs. 10000 

Repayment tenure: 

• Small Enterprise:  6 years  
• Micro Enterprise: 6 years 
• Medium Enterprise: 7 years 

Margin:  

• Small Enterprise:  Nil 
• Micro Enterprise: 20% to 25% lower than the Bank’s norm 
• Medium Enterprise: 20% to 25% lower than the Bank’s norm 

Security 

• Small Enterprise:  Pledge and assurance of Spouse or a Family member wherever required. 

• Micro Enterprise:  Pledge along with two guarantors and Collateral Security (25%) 

• Medium Enterprise: Pledge along with two guarantors and Collateral Security (30%)

Udyogini Scheme from Punjab & Sind Bank (PSB)

Calculated Interest: 9.65% onwards (Working Capital Loan) 

Lending Types: Working Capital Loans and Term Loans 

Size of loan: Based on requirements 

Service fee: Nil 

Margin: Nil up to Rs. 25,000 

Security: Nil up to Rs. 25,000 

To name a few, below is a list of businesses the Udyogini Scheme supports: 

• Bakeries 
• Diagnostic labs 
• Library 
• Papad making 
• Gift shops 
• Tea stalls 
• Pottery 
• Ice-cream parlor 

• Crèche 
• Jute manufacturing 
• Processing of spices  
• Woolen garments manufacturing 
• Canteen & Catering 

• Flour mills 

 Document required for applying: 

• Aadhar card or BPL card 

• Income proof 
• Birth certificate 
• Caste certificate (for SC/ST) 
• Copy of the bank passbook clearly identifying the account holder’s name, account number, bank name, branch name, IFSC, and MICR codes. 
• Two passport-sized photographs 

How to apply for Udyogini Scheme? 

Please follow these steps:  

•  Download the Udyogini Yojana application form or get it from your bank.  

• Complete the application correctly.  

• Once the process of form filling is complete, submit the form with all the required documentation, as stated on the form.  

• The funds will be released to you once your application is approved. 

Summary: 

 By fostering the understanding of women’s entrepreneurship among the poor and underprivileged, Udyogini Scheme has had success in bringing about significant changes within the business community.  The growth of women’s entrepreneurship has been aided by financial assistance provided to them. Also, this scheme has helped elderly women living in rural and backward areas, who would otherwise have difficulty finding work. Udyogini scheme has been of great help in augmenting individual and family incomes as well as contributing to the overall development of the country. 

Other similar MSME schemes have played a significant role in the development of this country, as well as in creating a multitude of employment opportunities. Increasingly important to the country’s economic growth, they are now widely recognized. Its progress is primarily the result of industrialization and advancing rural backward areas throughout the country. As a result of the rapid growth of SSIs and MSMEs in India, the country’s economy has taken a major leap forward. 

Through many such efforts, financial access has been facilitated for the poor. As a result, they have made real the hopes and dreams of many people to own their own businesses. It has not only encouraged the less fortunate but also made sure that a developing country like ours gets the global recognition that it deserves.