Udyogini Scheme: Eligibility, Documents Required, How to Apply Online, Interest Rate, Benefits

In recent years, the number of women entrepreneurs in India has grown significantly, yet they continue to face challenges, including limited access to funds. To support women in establishing businesses and becoming self-reliant, the Udyogini scheme was launched. Initially introduced by the Government of Karnataka, it was later expanded by the Central Government across India. This article discusses the Udyogini scheme, its eligibility criteria, required documents, and application process.

What Is Udyogini Scheme?

One of the Government of India's significant concerns is empowering Indian women and making them Atma Nirbhar. Hence, the government launched the Udyogini scheme to provide loans to budding women entrepreneurs for small-scale businesses, retail businesses, and agriculture activities. The respective state’s Women’s Development Corporations supervise this scheme.

This scheme empowers poor women entrepreneurs to start businesses with financial assistance. Under this scheme, beneficiaries can avail of business loans and subsidies on loans to start businesses in different sectors. The government has directed financial institutions to offer interest-free business loans to women from various sections of society. 

Eligibility For Udyogini Scheme 

Here are the eligibility criteria for the Udyogini scheme:

• Applicant must be a woman. 
• Applicants must be between the ages of 18 and 55 years.
• The applicant’s annual family income must be less than Rs. 1.5 lakh.
• There is no upper limit for beneficiaries who come under the disabled, widowed or destitute categories.
• Applicants can avail this scheme if their businesses are engaged in small-scale industry sectors, retailers, manufacturers, traders, self-employed professionals and other related categories. 
• Applicants must have a good credit score. 

Documents Required For Udyogini Scheme

When you want to apply for the Udyogini Scheme, you must submit the following documents to a financial institution:

• Passport-size photographs. 
• Ration card or voter ID card.
• Detailed Project Report (DPR) of the activity for which you want financial assistance.
• Certificate regarding training or experience in the activity for under which you want financial assistance.
• Family’s annual income certificate.
• Caste certificate if you are an ST/SC applicant.
• Quotations of machinery, equipment and capital expenses.  
• Proof of residence.

How To Apply For Udyogini Scheme?

When it comes to applying for the Udyogini Scheme, applicants can use online and offline mediums. Here are the detailed steps for applying online and offline.

Online Method

• Step 1: Visit the bank’s official website.
• Step 2: Look for the Udyogini scheme option and click the link to complete the application form. 
• Step 3: The CDPO (Child Development Project Officer) will scrutinise your application and forward it to the selection committee after spot verification.
• Step 4: The selection committee will examine your application form and forward it to the bank.
• Step 5: The bank will verify your documents and project proposal and process your loan application. 
• Step 6: After successful verification, the bank will send a request letter to the Women’s Development Corporation to release the loan subsidy.
• Step 7: Once the loan application is approved, the bank will release the loan amount directly to your bank account or supplier’s account for equipment, machinery or other capital expenditures. 

Offline Method

• Step 1: Obtain the application form by visiting the bank or downloading it from the bank's official website. 
• Step 2: Fill out the application and visit the bank that offers a loan under the Udyogini scheme with all the required documents.
• Step 3: Submit the form and documents to the bank officials along with the required documents. 
• Step 4: The bank will verify your loan requests and examine documents and project proposals. 
• Step 5: After successful verification, the bank will send a request letter to the Women’s Development Corporation to release the loan subsidy.
• Step 6: Once the loan application is approved, the bank will release the loan amount directly to your bank account or supplier’s account for equipment, machinery or other capital expenditures. 

Udyogini Scheme Interest Rate

The Udyogini scheme offers loans with an interest rate of 6% for most applicants. However, women from specific categories such as disabled, Dalit, and widowed may qualify for interest-free loans. Other women may receive loans with interest rates ranging from 10% to 12%. The repayment period is typically 36 months, including a 6-month moratorium. Additionally, eligible applicants may receive a 30% subsidy on the loan amount, depending on their family income.

Benefits Of Udyogini Scheme

Here are some benefits of the Udyogini scheme that you will get when you avail this scheme:

• If you fulfil this scheme's eligibility criteria, you can get a loan of up to Rs. 3 lakhs. However, there is no loan limit for disabled women and widows.
• It offers a 30% subsidy on loans to help women while repaying their loan amount.
• With this scheme, you can start a business categorised under 88 small-scale industries. 
• Interest-free loans are available if you want to start a business in the agricultural sector.
• It helps women become self-reliant and financially stable.

Business Categories Under Udyogini Scheme

Here is a list of business categories supported under the Udyogini scheme:

• Agarbatti manufacturing
• Audio-video parlour
• Bakeries
• Banana leaf manufacturing 
• Beauty parlour
• Bangles
• Bed sheet and towel manufacturing
• Books and notebooks binding
• Bottle cap manufacturing 
• Bamboo article manufacturing 
• Canteen and catering
• Creche
• Clinic
• Condiments
• Coconut shop
• Chalk crayon manufacturing
• Chappal manufacturing
• Cleaning powder
• Coffee and tea powder
• Corrugated box manufacturing
• Cotton thread manufacturing
• Cut-piece cloth trade
• Dairy and poultry trade
• Diagnostic lab
• Dry cleaning
• Dry fish trade
• Eat outs
• Edible oil trade
• Energy food
• Fairtrade shop
• Fax paper manufacturing
• Fish stalls
• Flower shops
• Flour mills
• Fuelwood
• Footwear manufacturing 
• Gift articles
• Gym centres
• Handicrafts manufacturing
• Household article retail
• Ice cream parlour
• Ink manufacturing 
• Jams, jellies and pickles manufacturing
• Typing and photocopy
• Jute carpet manufacturing 
• Library
• Leaf cup manufacturing
• Mat weaving
• Matchbox manufacturing
• Milk booth
• Mutton stalls
• Newspaper, weekly and monthly magazine vending
• Nylon button manufacturing 
• Old paper mart
• Pan and cigarette shop
• Pan masala shop
• Papad manufacturing
• Phenyl and naphthalene
• Photo studio
• Plastic article shop
• Printing and dyeing
• Quilt and bed manufacturing
• Radio and TV service
• Ragi powder shop
• Readymade garment
• Real estate agency
• Ribbon manufacturing 
• Sari and embroidery
• Security service
• Shikakai powder manufacturing
• Silk weaving
• Shops and establishment
• Silk thread manufacturing 
• Silk-worm rearing
• Soap oil, cake manufacturing 
• Stationery shop
• STD booths
• Sweet shops
• Tailoring
• Tea stall
• Travel agency
• Tutorials
• Typing institute
• Vegetable vending
• Vermicelli manufacturing
• Wet grinding
• Woollen garment manufacturing

The government has launched the Udyogini scheme to assist women entrepreneurs in their businesses. It financially assists them in setting up a business by offering loans at zero or low-interest rates and becoming Aatmanirbhar. Hence, the government helps women entrepreneurs impart skills and become financially stable.