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Top 5 Government Business Loan Schemes In India 2022

Top 5 Government Business Loan Schemes In India 2022

The economic growth of a country depends on its MSMEs i.e., Micro, Small, and Medium Enterprises. It’s because MSMEs provide a solution to economic problems like income inequality, unemployment, poverty, & regional imbalances. In short, MSMEs are responsible for serving millions of people in a country and contributing to the overall GDP of the country.

However, fledgling enterprises do face lots of hurdles like lack of money, infrastructure, etc. To relieve, them out, government business loan schemes are a great option. Here’s a list of all important loan schemes in India.

Government Business Loan Schemes & Eligibility

1. MUDRA Loan under PMMY

MUDRA loan under PMMY provides financial support to non-farm small/micro and non-corporate enterprises. The loan can be availed from commercial banks, small finance banks, regional rural banks, public and private sector banks.

3 MUDRA Loan Types:

Shishu Scheme: up to Rs. 50, 000

Kishor Scheme: from Rs. 50, 000 to Rs. 5, 00, 000

Tarun Scheme: from Rs. 5, 00, 000 to Rs. 10, 00, 000

Eligibility:

  • Minimum age should be 18 years & maximum age should be 65 years
  • Applicants should not have any past loan defaults

Features: 

  • Nil Processing fee
  • Collateral-free loans
  • Loan up to Rs. 10 lakhs
  • Repayment Tenure lies from 12 months to 5 years
  • Zero prepayment charges
  • Competitive Interest Rates from NBFCs/banks

Also Read: How To Apply For Personal Loan & Get Quick Approval

2. Stand-Up India

Stand-up India loan Scheme is governed by SIDBI or Small Industries Development Bank of India. It gives funding to SC/ST category as well as women entrepreneurs. You can take a bank loan from Rs. 10 lakh to Rs. 1 crore.

Eligibility: Enterprises engaged in the manufacturing, service, or trading sector are eligible. The non-individual enterprise must have 51% of the shareholding.

Features:

  • Rate of Interest sums to bank rate (MCLR) + 3% + Tenor Premium
  • Composite loan benefits from Rs. 10 lakh to Rs. 1 crore for 75% project completion

3. PSB/MSME Loan in 59 Minutes

Get assistance up to Rs. 5 crores in 59 minutes under PSB/MSME loan scheme. MSMEs and start-up businesses can take financial assistance to scale their business.

Eligibility: Applicant must be self-employed and running a small company or business with GST compliance.

Features:

  • 8.50% rate of interest per annum
  • Collateral-free loans
  • Fast loan processing (7-10 working days)
  • Quick loan approval (59 minutes)

4. National Small Industries Corporation (NSIC) Subsidy 

Under National Small Industries Corporation Subsidy, the government aid MSMEs that focus on raw material and marketing. Being an ISO-certified Indian Government scheme, it offers many benefits to enterprises. You can get a loan of up to Rs. 25 lakhs. Under NSIC, two schemes are available namely, marketing support scheme and credit support scheme.

Eligibility: Enterprise must have Udyog Aadhaar registration.

Features:

  • Cost-free tenders
  • No security deposit requirement
  • Land & building financing

Also Read: 10 Personal Loan Scams Signs You Must Be Aware Of

5. SIDBI Make in India Soft Loan Fund (SMILE)

The small industries development bank of India governs the SMILE scheme. It provides soft loans to MSMEs for its establishment. During COVID times, the SMILE scheme offers an 8.25% interest rate.

Eligibility: Borrower must have the good credit score to get a loan up to Rs. 25 crores

Features:

  • Shorter loan repayment terms
  • Quick fund disbursement
  • Attractive interest rates
  • Contactless platform

These are 5 major government loan schemes for micro, small and medium enterprises. 

Also Read: Best Car Loan Interest Rates 2022: Full Comparison, Eligibility Criteria, Processing Fee, Etc

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