Top 7 Government Loan Schemes for Small Business in India

Government Loan Schemes for Small Business

To make the lives of citizens more comfortable and to give businesses a boost, Government schemes are created. The aim is to increase productivity by providing easy access to credit.

The Government of India is trying to make it easier for small businesses in the country by introducing new loan schemes.

If you’re at all interested in starting a business, these loans may be just what you need!

Be sure to read up on them before applying so that you know your options and can find one that suits your needs.

You’ll also want to keep an eye out for when they release more details about their plans – this will help ensure there’s something available for everyone who wants or needs financing.

What are some things you think would improve government-provided small job creation programs?

Top Government Loan Schemes for Small Business in India

We’ll list some of the top Government loan schemes for small businesses in India here:

1) Mudra Loans

Mudra loans come from Pradhan Mantri Mudra Yojana (PMMY), a small finance bank that provides loans to SMEs without any collateral.

The list of eligible borrowers includes shopkeepers, fruit sellers, metal polish workers, mobile recharge shops, kiranas shops and NGO-related activities amongst others.

The loan can be used for business expansion or repayment of debt. It typically ranges from ₹50,000 to ₹10 lakh and can also be used for purchase of equipment.

2) Stand-Up India Scheme

The Stand-up India Scheme is a Government of India programme to enable at least one member from each family of the Scheduled Castes (SCs), Scheduled Tribes (STs) and socially and educationally Backward Classes to become an entrepreneur.

The Government of India will make efforts to create at least one Dalit-owned enterprise in every district of the country through this scheme.

3) Credit Guarantee Fund Scheme for Micro and Small Enterprises, 2016

This is a credit guarantee scheme which would provide an effective mechanism for risk mitigation with reasonable premium by creating a Fund.

The objective is to reduce the rate of interest so as to increase viability and consequently, higher level of credit flow to MSME Sector.

4) National Small Industries Corporation Subsidy Scheme

Under this scheme, 80% of subsidy is provided for working capital and 20% of subsidy is provided for modernisation and expansion.

The maximum limit of the subsidy is up to 50% of project cost subject to a ceiling of ₹5 crore (both for SC and ST units).

5) Credit Link Capital Subsidy Scheme for Technology, Upgradation, and Modernization

This scheme is based on an equity participation with the objective of increasing the profitability and productivity of MSMEs by providing credit link capital subsidy. The applicant should be in operation for at least five years.

6) Udyogini Scheme

The Udyogini Scheme was started by Government of India during 2008-09 to provide financial assistance to women entrepreneurs belonging to economically weaker section of society.

For this purpose, a fund is created by taking 1% levy from the gross turnover of all members in MSME Sector registered with Ministry of Micro, Small and Medium Enterprises (MSME).

7. MSME Business Loans in 59 Minutes’s App!

Check out our mobile app to get detailed information on top Government loan schemes for small businesses in India. This mobile app is available for free download on Google Play Store and Apple Store.

Business Loans are awarded by the bank only after careful assessment of your business proposal.

It will be checked, if you have enough collateral for bank loan. It will also be checked whether you have been running your business successfully or not.

Even your past record of missed installments of outstanding loans from the bank is also a critical factor for sanctioning business loan by banks.

In India, there are mainly three types of government subsidized credit schemes available to small scale industries for their working capital requirements. These schemes are –

The Stand-Up India Scheme is a Government of India programme to enable at least one member from each family of the Scheduled Castes (SCs), Scheduled Tribes (STs) and socially and educationally Backward Classes to become an entrepreneur.

The Government of India will make efforts to create at least one Dalit-owned enterprise in every district of the country through this scheme.

Apart from these schemes, many banks have also come up with their own SME schemes. For example, Karnataka Bank has Kalashree Loans and the State Bank of India (SBI) has SBI Kuri Sanjeevani Loans.

The above mentioned schemes are some of the most important Government loan schemes for small businesses in India today. It is pertinent to note that all these schemes have been created to help small businesses during their initial stages of growth.

Top Government Loan Schemes for Small Business in India

The Indian government has launched various schemes to assist entrepreneurs to start new business enterprises. There are the following schemes by which you got help from the government.

There are several different types of small business loans available in the market that an entrepreneur can opt for, including SBA, Balance Sheet Loans, etc.

As per the eligibility conditions of the scheme, the entrepreneur must be an Indian resident or a new business / entity in India; cannot have defaulted on previous bank loans; and should not be engaged in any full-time occupation other than running their own business.

The loan amount can vary from Rs 5 lakhs to Rs 5 crores, to be repaid in a maximum of 10 years.

Which bank is best for small business loan in India?

In this way, Indian government had set up some schemes for the small business owners.

Most of these schemes are meant to provide encouragement to the budding entrepreneurs who do not have an access to traditional modes of finance like Banks and Financial Institutions.

The loans provided by these schemes are interest-free with long repayment period (upto 10 years). You can visit this website to know more about small business loan in India.

If you’re a small business owner in India and looking for some help with financing, we have the perfect article for you. We cover most of the top government loan schemes that can help your business grow.

Whether it is to start up or expand an existing venture, these programs will get you on track quickly and without too much hassle! Which one are most interested in learning about?

The government has introduced many schemes to help small businesses in India. We’ve listed some of the most popular ones here, so that you can weigh your options and see which one suits you best!

Which loan scheme are you looking at applying for? Let us know! Stay updated with our latest government schemes for entrepreneurs and small businesses in India at SugerMint.