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Top 5 Startup Business Loan Schemes by Indian Government

  • 02-Mar-2022
Top 5 Startup Business Loan Schemes by Indian Government

The Indian economy sector includes the MSME sector (micro, small and medium enterprise). It is known for being the biggest job originator in India and gives 30% to India’s GDP. 

The government offers several schemes for startup business loans are: 

  1. Pradhan Mantri Mudra Yojana (PMMY)
  2. Stand–up India
  3. Credit Guarantee Scheme
  4. National Small Industries Corporation (NSIC)
  5. MSME (Micro, Small, and medium enterprise) loan in 59 minutes
  • Pradhan Mantri Mudra Yojana – This government scheme was set up in 2015 to provide funds to small enterprises, non-corporate, and non-farm establishments. It focuses on offering loans to all types of trading, manufacturing, and service sector authorities. It can be assisted by public sector banks, commercial banks, private banks, corporate banks, small finance banks, Regional Rural Banks (RRBs). It is a collateral-free loan and there is no prepayment and processing fee to be charged. Tenure for repayment is 12 months to 5 years.

 The PMMY scheme offers loans that come in the classification of:  

  1. Tarun in amount comes between 50,000
  2. Shishu
  3. Kishor
  • Stand-up India -  The startup India scheme was set by the government which set up in April 2016 and was run by the SIDBI (Small Industries Development Bank of India). This scheme enhances loans to businesses in trading, services, and manufacturing. This scheme gives bank loans ranging between Rs. 1 lakh – Rs. 1 crore to a minimum of 1 Schedule Caste / Schedule Tribe applicant and one-woman applicant provided by each branch of the bank. The repayment of the borrowed amount should be done in seven years although the maximum suspension period grant is 18 months.
  • Credit Guarantee Scheme – A credit guarantee fund is a loan scheme which is established by the government of India, which allows financing through loans without security or collateral to the business that comes under the MSME sector. Any RRBs (Regional Rural Banks) and commercial banks can come under a credit guarantee scheme by taking itself as a lender power. Credit guarantee fund gives loans up to Rs. 10 lakh and has large for huge sanctions. It has been organized by the Ministry of MSMEs. And for the sanction of Rs 10 lakhs, you need to pledge your lands and assets of the business.
  • National Small Industries Corporation (NSIC)  - National Small Industries Corporation was launched in 1955. It is certified by ISO. It runs by the women applicant. It works to assist and raise the growth of micro, small, and medium enterprises by issuing integrated support services and all-inclusive technology, marketing, finance, and other related services all over the states. The company focuses on assigning machinery for exports in marketing and on a purchase basis.

To uplift the growth of MSME, National small industries corporation gives many schemes such as: 

Marketing support scheme- market support is very important for the growth of any business and critical for the growth of MSMEs in the competitive market.  

Credit support scheme- in this scheme, NSIC gives funds to get raw materials. 

  • MSME loan in 59 minutes- MSME Loan is also called PSB Loan in 59 minutes which is governed. The process for a business loan is discouraging, which involves discussing with the staff, going to the banks for months, irritating paperwork. Under this scheme, you can get Rs 1 lakh to Rs 5 crores within 59 minutes at an interest rate of 8.50% from private banks, public sector banks, and NBFCs.

Business companies who are eligible for this loan are as follows: 

  • The capacity of the borrower for the repayment
  • Credit facilities
  • Income/revenue
  • Other financial factors

Also Read:- Fact About Business Loan and Their Benefits

Startups Business Loan  

You can get a startup for business loans from Banks, Financial institutions, and NBFCs to lift funds to start a new business or existing business.  The interest rate charged by the financial body or bank will depend on the loan amount. 

Business Loan 

A business loan is an amount of money that the lender gives and an applicant pays it back with interest on the loan amount within a particular period. 

Interest rate 14.50% 
Loan amount Up to 5 crores 
Processing fee Up to 6.5% 
Loan tenure Up to 36 months 

Loan scheme for MSME 

  •  Pradhan Mantri Mudra Yojana (PMMY)
  • Credit Guarantee Fund
  • Credit Linked Capital Subsidy
  • Prime Minister’s Rozgar Yojana
  • Standup India
  • National Small Industries Corporation
  • Startup India

Planning to get a business loan scheme by the Indian government. Apply through financeseva to avail best deals. 


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