Are you looking for funding to start or expand your business in India? If yes, then you might want to know about the various government business loan schemes that are available for entrepreneurs and small business owners. These schemes provide financial assistance to various sectors such as agriculture, manufacturing, services, women-owned industries, and more.
Top 5 government business loan schemes in India
There are many government business loan schemes in India, but here are some of the most popular and widely available ones:
- MUDRA Loan: This is a flagship scheme of the government that provides loans up to Rs. 10 lakh to enterprises engaged in manufacturing, trading, and service. The loans come under 3 categories: Shishu (up to Rs. 50,000), Kishore (Rs. 50,000 to Rs. 5 lakh), and Tarun (Rs. 5 lakh to Rs. 10 lakh).
- CGTMSE: This is a credit guarantee scheme that provides collateral-free loans up to Rs. 2 crore to new and existing small and medium enterprises (SMEs). The scheme covers up to 75% of the default risk of the lender, and charges a one-time guarantee fee and an annual service fee.
- MSME business loans in 59 minutes: This is a digital platform that enables SMEs to get in-principle approval for loans up to Rs. 5 crore from multiple banks and NBFCs within 59 minutes. The platform uses advanced algorithms and data analysis to assess the eligibility and creditworthiness of the applicants. The platform also offers other benefits such as GST registration, income tax filing, and business advisory.
- Stand Up India: This is a scheme that aims to promote entrepreneurship among women and SC/ST communities in India. The scheme provides loans from Rs. 10 lakh to Rs. 1 crore to set up green field enterprises in the manufacturing, trading, or service sectors. The loans come at a concessional interest rate. The scheme also provides mentoring to the beneficiaries.
- PMEGP: This is a credit-linked subsidy scheme that provides loans up to Rs. 25 lakh to set up micro enterprises in the rural and urban areas. The scheme is by the Khadi and Village Industries Commission (KVIC), which is the nodal agency of the government. The scheme offers a subsidy of 15% to 35% of the project cost, depending on the category and location of the beneficiary.
How to apply for a government business loan in India
The application process for a government business loan in India varies, depending on the scheme and the lender. However, some of the common steps are:
- Identify the scheme that suits your business needs and eligibility criteria.
- Visit the official website or portal of the scheme or the lender and fill up the online application form with the required details and documents.
- Submit the application form and wait for the verification and approval process.
- After approval, sign the loan agreement and receive the loan amount in your bank account.
Alternatively, you can also visit the nearest branch or office of the scheme or the lender and submit the physical application form along with the necessary documents.
Eligibility criteria for government business loans in India
The eligibility criteria for government business loans in India depend on the scheme and the lender. However, some of the general criteria are:
- You should be an Indian citizen and above 18 years of age.
- You should have a valid Aadhaar card, PAN card, bank account, and GST registration (if applicable).
- You should have a viable business plan and project report.
- You should have a good credit history and score, and no pending dues or defaults with any financial institution.
- You should meet the specific scheme criteria, such as the sector, segment, category, location, etc.
Documents required for government business loans in India
The documents required for government business loans in India vary depending on the scheme and the lender. As a rule, you should have:
- Identity proof, such as Aadhaar card, PAN card, voter ID card, passport, driving licence, etc.
- Address proof, such as Aadhaar card, electricity bill, water bill, telephone bill, rent agreement, etc.
- Business proof, such as GST registration, trade licence, MSME registration, Udyog Aadhaar, etc.
- Income proof, such as bank statements, Income Tax Returns, balance sheet, profit and loss account, etc.
- Project report, business plan, market survey, technical details, etc.
- Collateral security, if any, such as property papers, fixed deposits, insurance policies, etc.
Business loans by Bajaj Finserv for urgent expenses
If you are looking for a quick and easy way to get funds for your business, you can consider the Bajaj Finserv Business Loan. It is a collateral-free loan to help you meet your working capital needs, purchase equipment, expand your business, or any other business-related purpose.
Some of its features and benefits are:
- High loan amount: Get a loan amount of up to Rs. 80 lakh, depending on your eligibility and credit profile.
- Flexible repayment: Choose a repayment tenure of up to 8 years, from among 3 exclusive variants for flexible repayment options.
- Low interest rates: Enjoy a competitive rate and save on your interest cost.
- Minimal documentation: Apply for the loan with just a few basic documents.
- Online application: Apply for the loan online, and get approval and disbursal within 48 hours*.
