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Business Loan by Government

  • 23-Feb-2022

MSME (Micro Small Medium Enterprises) are the pillar of Indian economy also known as India’s engine of growth. Apart from generating employment opportunities, it has immensely built the growth of country day by day stronger. MSME's contribution to the nation is beyond the imagination. It has always addressed issues like poverty, income inequality and unemployment...etc.  

Most of the SMEs (Small Medium Enterprises) are engaged in several sectors which include: -  

  • Manufacturing
  • Services
  • Information technology
  • Mining
  • Packaging

Generally, startup & existing business faces a lot of challenges to fuel their business. Whether it’s a small or big unit each of them requires financial support. Therefore, The Government of India has initiated various schemes to benefit the MSMEs to raise GDP of the country.   

Also Read:- Business Loan for Startup

Business Loan Government Scheme  

As a business owner, you may look for a business loan. Some of the top business loan schemes offered by the government are listed below: -  

1. MUDRA Business Loan  

MUDRA stands for Micro Units Development and Refinance Agency. Under this scheme Startups & SMEs will be provided financial support to meet their day-to-day requirements. Borrowers who are willing to avail MUDRA business loans can contact banks, NBFCs & Financial Institutions. MUDRA loans are categorized into 3 subcategories as follows.  

  1. Shishu Loans upto Rs.50,000
  2. Kishor Loans upto Rs.5,00,000
  3. Tarun Loans upto Rs.10,00,000

Who is eligible?  

Age Criteria 18 – 65 Years  
Units engaged in 
  • Manufacturing
  • Trading
  • Service Sectors
Loan requirement Should be lower than Rs.10 lakh  

2. CGTMSE Loan Scheme  

The Ministry of MSME & SIDBI) Small Industries Development Bank of India together initiated a Trust named Credit Guarantee Fund Trust for Micro & Small Enterprises scheme is a business loan scheme launched by Government of India, it aimed to provide collateral-free loan for MSME Sector. Borrowers can avail working capital loans up to Rs.10 lakh.  

Who is eligible?  

Age Criteria  21– 65 Years  
Eligible Borrowers  New & Existing SMEs  
Units engaged in  
  • Manufacturing
  • Trading
  • Service Sectors

Excluding Training Institutions, Agriculture, Educational Institutions..etc.  

Loan requirement  Should be lower than Rs.200 lakh 

3. MSME Loan in 59 Minutes  

Looking for working capital requirements to enhance your business & that too in urgent need? The Indian government has launched a special portal that enables you to get in-principal approval in less than 59 minutes, this scheme is also known as PSB loan in 59 minutes. Compare deals offered by more than 20+ Banks & NBFCs in a single portal. It is a fully digital process no need to visit the branch for kind of application submission & other bank approaches. PSB loan ranges from Rs.10 lakh to 5 Crores come up with in-principal approval facility.   

Who is eligible? 

Age Criteria 22 – 65 Years  
Business Years  Minimum 3 years of business continuity required  
Units engaged in  
  • Manufacturing
  • Trading
  • Service Sectors
  • Sole proprietors & private companies are eligible
Income  Turnover of business should be Rs.10 lakh a year & must generate profit for at least 2 years
Other Requirements Business must be registered as an MSME

Also Read:- Top 5 Factors Determine Your Working Capital Loan Approval

4. Credit Linked Capital Subsidy Scheme (CLCSS)  

The objective of the scheme is to provide technology up-graduation by facilitating 15% of the upfront capital subsidy to Micro and Small Enterprises (MSEs), which includes khaki, tiny, village units and coins industrial units to restructure their entire process of production. One of the added advantages is women entrepreneurs are given preference in terms of availing CLCSS credit facility. SSI units can avail a maximum loan of Rs.100 lakh along with 15 percent subsidy which shall go up to Rs.15 lakh under this scheme.  

Who is eligible?  

Business Years Minimum 3 years of business continuity required  
Beneficiary should be   Private & public companies, sole proprietorships, partnerships, co-operative societies under SSI units are eligible  
Other Requirements  MSEs must have a valid UAM number  

5. National Small Industries Corporation (NSIC)

National Small Industries Corporation (NSIC) was launched in 1955 under MSMEs, it aims to promote the growth of MSME nationwide by facilitating combined assistance schemes. It offers a wide range of services such as technology, marketing, finance & support services. NSIC provides various schemes to boost the participation of MSMEs as follows: -  

Marketing Assistance: - Each business requires marketing assistance to promote its brand, NSIC stands here to form a consortium among enterprises. This will enable MSME to interact with institutional buyers under a single platform. 

Raw Material Assistance: - NSIC helps MSMEs by providing financial support to procure raw materials (both indigenous & imported) at discounted rates. By doing so, MSME would give their 100% concentration in manufacturing goods rather than worrying about materials financing. 

Category  Requirements  
Micro Enterprises (Investment) 
  • For plant & machinery upto Rs.25 lakh
  • For service sector upto Rs.10 lakh
Small Enterprises (Investment)  
  • For plant & machinery upto Rs.5 Cr
  • For service sector upto Rs.2 Cr

Get easy financing through Financeseva 

Planning to avail a business loan by the government with credit linked facility, simply your loan processing through Financeseva. Get loan up to 75 lakh to meet your financial requirements. Apply online for additional benefits.

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