The phenomenal growth of unicorns in India, led by young entrepreneurs, is inspiring thousands of aspirational startups in the country. After the United States (US) and China, India has emerged as the world’s third largest startup ecosystem, and the way college students are preparing to join this carnival, it seems nothing can stop them from realising their dreams. In 2021, India has added three unicorns (startup firms valuing more than $1 billion) per month, bringing the total to 51, ahead of the United Kingdom (32) and Germany (32).
Though it is remarkable that five among these unicorns in India are led by women, there are many reasons why Indian women entrepreneurs should come forward in large numbers to join the startup rally. India is predicted to remain the fastest-growing economy in the years to come and India’s market capitalisation is growing even faster than its nominal Gross Domestic Product. Market segments such as consumer durables to textiles, food to footwear, agro-products to automobile, all are expected to have double-digit growth as the economic recovery is gaining momentum.
Given the market demand, startups need three basic ingredients: Idea, mentorship and finance. All three of them are available like never before to aspiring women entrepreneurs in India. Most of the colleges are offering mentorship programmes to women to encourage startup ideas by female graduates. Incubation and acceleration support is available through the Women Entrepreneurship Programme (WEP) offered by NITI Aayog. Special category benefits are available under the Pradhan Mantri Employment Generation (PMEG) programme of the ministry of small and medium enterprises (MSME).
The Government of India and many state governments are running schemes to improve financial inclusivity for women. Mudra is one such high-potential scheme for women because it offers collateral free loans.
The Dena Shakti Scheme provides loans up to ₹20 lakh for women entrepreneurs in agriculture, manufacturing, micro-credit, retail stores, or small enterprises. The scheme also provides a concession of 0.25% on the rate of interest.
Stree Shakti Yojana and Orient Mahila Vikas Yojana support women who have majority of ownership in the business. Women who want to enroll themselves in catering business can attain loan via the Annapurna Yojana. Under this scheme, which has now been merged with the national old-age pension scheme, offers business loans up to ₹50,000.
Bhartiya Mahila Bank (now merged with State Bank of India) offers Shringaar loan, which enroll women or homemakers planning a startup or meeting their daily business expenses and Parvarish loan where the upper limit of loan can be ₹1 crore (without any collateral) under the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGSTSM) scheme. Other than government schemes, various venture and angel investors are also keen on putting their money behind the ideas of bright Indian women entrepreneurs. A robust ecosystem of micro-financing Self Help Groups(SHGs) is also being created at village level by social-preneurs.
Now over 80% of Indian women have bank accounts. About 200 million of them were added under the Jan Dhan Yojana. Data under MSME has shown that women have shown a surge in startups in the domain of fashion, textiles, and homemade accessories.
This indicates that the path for a more inclusive and empowered society is being paved. Since women have several financial options to avail from, it needs increased risk appetite in Indian women before they leave behind men in the startup race. Women in India should grab the golden opportunities arising out of this unicorn utsav to start their own business and lead the journey towards Atmanirbhar Bharat.
Rajesh Gupta is director, NITI Aayog, and Harshita Duggal is intern at NITI Aayog.
The views expressed are personal.
