AI SummaryTamil Nadu government has launched the Vetri Magalir Thozhilmunaivor Membattu Thittam, a business loan scheme that gives women entrepreneurs loans from ₹10 lakh to ₹5 crore through Tamil Nadu Industrial Investment Corporation (TIIC). Interest is 9.95% a year on a diminishing balance, and the loan can be repaid over up to 9 years.
Industries Minister S. Keerthana announced the scheme in August 2026 with a ₹500 crore loan pool for this financial year. At the end of September 2026, the state asked every MLA to pick 10 women from their constituency who want to start or grow a business, so the scheme reaches women outside big cities too.
Vetri Magalir loan scheme for women in Tamil Nadu
Loans are meant for women who want to set up a new micro, small or medium enterprise, and for women who already run one and want to expand or modernise it. Expansion requests go through the same scrutiny as new projects.
Loan amount, interest and other relaxations
TIIC normally asks for more money from the owner and more security than this scheme does. For women borrowers under Vetri Magalir, these terms have been relaxed:
- Interest rate cut from 10.20% to 9.95% a year, calculated on the reducing balance, so interest falls as the loan is repaid.
- Promoter contribution reduced from 35% to 20% of the project cost, which means the woman puts in less of her own money.
- Collateral needed brought down from 50% to 40% of the loan amount.
- Free entrepreneurship development training before the loan, covering business planning and running a unit.
- Repayment period of up to 9 years.
For a rough idea, a ₹50 lakh loan at 9.95% over 9 years works out to an EMI of about ₹70,250 a month. The actual EMI depends on the sanctioned amount, tenure and any moratorium TIIC allows. TIIC has also waived registration and investigation fees on all term loans sanctioned in 2026-27.
Government expects more than 500 women-led MSMEs to get loans this year and more than 3,500 new jobs to come out of them.
| Detail | Information |
|---|---|
| Scheme Name | Vetri Magalir Thozhilmunaivor Membattu Thittam |
| State | Tamil Nadu |
| Announced By | Industries Minister S. Keerthana (August 2026) |
| Lending Agency | Tamil Nadu Industrial Investment Corporation (TIIC) |
| Loan Amount | ₹10 lakh to ₹5 crore |
| Interest Rate | 9.95% a year (diminishing balance) |
| Repayment | Up to 9 years |
| Total Loan Pool 2026-27 | ₹500 crore |
| Official Website | www.tiic.org |
Who can apply
Women aged 18 years or more who want to start a new enterprise in Tamil Nadu, or who own a running unit and want money to expand it, can be considered. A full eligibility notice with income limits, sector list and required documents has not been released yet. Final selection depends on how viable the business proposal is and on TIIC's normal lending rules.
How to apply for Vetri Magalir loan
There is no separate online form for the scheme yet. Applications are moving through two routes, the MLA nomination and TIIC's own loan process.
STEP 1 - Contact your local MLA's office and ask to be included in the list of 10 women from your constituency. MLAs send these profiles to the Industries Department.
STEP 2 - Prepare a project report with the business idea, total cost, machinery or building needed, expected income and how much of your own money you can put in (at least 20%).
STEP 3 - Visit the nearest TIIC branch office, or go to www.tiic.org and use the 'Apply Online' option, and mention the Vetri Magalir scheme.
STEP 4 - Attend the entrepreneurship training and the TIIC field inspection when called. After checking eligibility and the project, TIIC decides the loan amount and sanctions it.
An MLA nomination alone does not guarantee a loan. Every profile is checked on eligibility and merit before money is released.
If you are looking for smaller amounts, then you can check the NEEDS scheme for first-time entrepreneurs, the Tamil Nadu Credit Guarantee Scheme for collateral-free loans, or Mudra loan.
FAQ's
Is Vetri Magalir loan scheme the same as Vetri Magalir Goat Rearing Scheme?
No. Goat rearing scheme gives five free goats or sheep to rural widows, deserted women, transgender persons and persons with disabilities. Vetri Magalir Thozhilmunaivor Membattu Thittam is a TIIC business loan.
Does this loan come with a subsidy?
Main benefits are the lower 9.95% interest, lower own contribution and lower collateral. A separate capital subsidy has not been announced for this scheme.
Can women get less than ₹10 lakh under this scheme?
No, the minimum loan is ₹10 lakh. Women who need smaller loans should look at NEEDS, UYEGP or Mudra instead.