Union Budget 2025: New Rs 2 crore loan scheme for women & SC/ST entrepreneurs, says FM Nirmala Sitharaman

Union Budget 2025: On Saturday, Finance Minister Nirmala Sitharaman presented India's Union Budget for 2025-26, marking her record eighth consecutive budget. Against the backdrop of an economic slowdown and rising calls for tax cuts for the middle class, the budget outlined a series of measures designed to accelerate growth and ensure inclusive development. Notably, a significant focus was placed on empowering women, especially in the entrepreneurial space, with initiatives that aim to bridge existing gaps in the economy.

Union Budget 2025: Credit Access and Loans for Women Entrepreneurs

A central feature of the 2025-26 Budget is a new scheme designed to support women entrepreneurs, particularly first-time business owners from Scheduled Castes (SC) and Scheduled Tribes (ST). The government plans to provide term loans of up to Rs 2 crore to 5 lakh women entrepreneurs over the next five years, thus facilitating access to capital for those who have historically faced challenges in securing credit.

The Finance Minister explained the government's broader vision for India’s economy, emphasising, “Our economy is the fastest-growing among all major global economies. Our development track record of the past 10 years and structural reforms have drawn global attention. Confidence in India’s capability and potential has only grown in this period. We see the next five years as a unique opportunity to realise ‘Sabka Vikas,’ stimulating balanced growth of all regions.”

Sitharaman stated, “Union Budget 2025-26 with an effort to a. Accelerate growth b. Secure inclusive development c. Invigorate society and industry d. Uplift household sentiment and e. Enhance spending on power of India’s rising middle class.”

Presenting the Union Budget for 2025-26, the finance minister also said a manufacturing mission will be set up for SME and large industries.

Besides, the government will undertake facilitation measures to enhance productivity of labour-intensive sectors, Sitharaman said.

The credit guarantee cover will be doubled to Rs 20 crore, guarantee fee moderated to 1 per cent, she added.

She also said a national institute of food technology, entrepreneurship and management will be established in Bihar.

Union Budget 2025: Inclusive Growth and ‘Sabka Vikas’

Sitharaman highlighted the government’s commitment to inclusive development, focusing on balanced growth across all regions. She underscored the importance of empowering all sectors of society, particularly women, in the economic landscape. As part of its vision for a ‘Viksit Bharat’ or Developed India, the government aims to eradicate poverty, provide quality education, and ensure access to affordable healthcare.

“We need to focus on poor, women, youth and farmers,” Sitharaman reiterated at the start of her speech, reinforcing the government's broad approach to economic empowerment. Increasing women’s participation in the workforce is a key component of this vision, with the government targeting 70% participation from women in the economy.

Budget 2025: Strengthening Welfare for Women Workers

Sitharaman had announced setting out a ?3 lakh crore Budget outlay towards women and girl-centric schemes in the full budget of 2024.

At the start of her speech, Sitharaman had announced that the government was focused on women, as one of the four major pillars in its policy plans.

"As mentioned in the interim-budget, we need to focus on poor, women, youth and farmers," Sitharaman had said in her address.

In addition to these plans, the Finance Minister also spoke of hostels for working women, as well as creches to help them juggle work and home.

During the interim budget, Sitharaman had announced that the government would be increasing the target of women beneficiaries under its Lakhpati Didi Scheme to three crore from two crore. "83 lakh Self Help Groups with nine crore women are transforming the rural socioeconomic landscape, and have assisted nearly one crore women in becoming lakhpati didis already," Sitharaman had said in her interim budget speech.

Sitharaman had also recounted the government's previous schemes for women, while also extolling Indian women' s participation in the workforce and in STEM courses. Furthermore, the finance minister had announced that the government would encourage cervical cancer vaccinations for girls between the ages of nine and 14. The government also extended healthcare cover under the Ayushman Bharat scheme to all ASHA workers. "The health cover under the Ayushman Bharat scheme will be extended to all ASHA and Anganwadi workers and helpers," Sitharaman had said.

Government Support Schemes for Women Entrepreneurs

The government has already launched several initiatives to empower women in business, aiming to provide financial assistance, training, and infrastructure to help them succeed as entrepreneurs. These schemes are designed to address the challenges women face in the entrepreneurial landscape, offering them access to capital, business guidance, and networking opportunities.

Mudra Yojana

The Mudra Yojana is one of the most significant initiatives aimed at supporting micro and small businesses, with a particular focus on women entrepreneurs. Under this scheme, loans up to Rs 10 lakh are provided without requiring any collateral. What sets it apart for women borrowers is the provision of lower interest rates, making it more accessible for women to start or scale their businesses. This initiative plays a crucial role in empowering women by offering them the financial backing to become self-sufficient and contribute to the economy.

Stand-Up India Scheme

The Stand-Up India Scheme encourages women to venture into the business world by offering bank loans ranging from Rs 10 lakh to Rs 1 crore. A key feature of this programme is its emphasis on inclusivity, as it mandates that at least one SC/ST borrower and one woman must be supported per bank branch. These loans are specifically for setting up greenfield businesses, which are newly established ventures. Furthermore, for non-individual firms, the scheme stipulates that a SC/ST or woman entrepreneur must hold at least 51% ownership, ensuring that women are leading the charge in these new enterprises.

Prime Minister’s Employment Generation Programme (PMEGP)

The Prime Minister’s Employment Generation Programme (PMEGP) is another pivotal scheme that fosters self-employment among women. This programme offers financial support to individuals wishing to set up new micro-enterprises and small businesses. By promoting women’s participation in the workforce and encouraging them to become job creators, PMEGP is instrumental in advancing economic equality.

Udyam Shakti Portal

Launched by the Ministry of MSME, the Udyam Shakti Portal is a dedicated platform for promoting women’s social entrepreneurship. It provides a wide array of services including business planning assistance, incubation facilities, mentorship, and market research. This portal offers projects a financial support range of up to Rs 25 lakh, with Rs 10 lakh earmarked specifically for service-based ventures. Through this initiative, women are given the tools and guidance they need to launch and expand their businesses successfully.

Economic Empowerment of Women Enterprises and Start-ups by Women

In an effort to accelerate the growth of women-led enterprises, the Ministry of Skill Development and Entrepreneurship has rolled out the Economic Empowerment of Women Enterprises and Start-ups by Women scheme. This programme focuses on offering incubation and acceleration support to female micro-entrepreneurs, providing them with the necessary resources and training to scale their businesses. Currently operational in Assam, Rajasthan, and Telangana, this scheme highlights the government’s commitment to nurturing women in the entrepreneurial ecosystem.