• Apply now

Money in bank in 24 hours

Apply now

What are the Benefits of MSME Loan?

  • Highlights

  • The need for finance for MSMEs

  • Why MSME loans are a popular source of finance

  • MSME loans provide flexibility of usage

  • MSME loans are fast and hassle-free to get

Every small business needs financial assistance at some point. Most Micro, Small and Medium Enterprises (MSMEs) usually require some sort of financial assistance when they are moving up the growth curve. The money may be needed for purchasing essential equipment, upgradation of infrastructure or for meeting operating expenses. Where the money comes from is totally the discretion of the owner and his/ her priorities. Many different businesses have the option of procuring financing from various borrowing instruments.

But, when it comes to MSMEs, the preferred route taken to address financial needs is an MSME loan in India.

Let us look at the factors which have made MSME loan so popular among small businesses in India.


Running a business in the Indian economic scenario can be challenging. Due to seasonality of demands and various other factors, there can be times with surplus of funds, while sometimes every penny can make a difference. When the latter situation arrives, funds will be required to be deployed on an urgent basis.

Availing an MSME loan is easy and hassle free. There is not much time taken to disburse the loan amount and documentation is also minimal. The processing time is very quick; companies like Bajaj Finserv have approval times as low as 24 hours. There is also online account access, which lets you access your account statement and loan details on the go.

Additional Read: The MSME Loan The efficient financing solution for MSMEs

Collateral-free Business Loans up to Rs. 20 lakh. Submit only 2 documents and get funding in just 24 hours- Apply Now

Full Control

A small business will also need to address the financial requirements of the company in the course of doing business. Finance is not easy to procure, and other sources of loan such as angel investors and venture capitalists offer finance but also seek to control part of the company in return.

A small business owner may not look forward to relinquishing control of the business.MSME loans are specifically designed to meet such requirements of small businesses. They are an excellent source of finance for business owners who wants to avoid liquidation of control

MSME Loans

The 4 types of business loan explained

From time to time, every business needs an external source of finance to fund its needs. While business loans are a convenient and hassle-free source of funds, it is important for small business owners to know which is the right type of business loan for their enterprise. Here, we showcase the 4 types of business loans, and what each of them is suited for, to help you make the best decision for your business.

Types of Business Loan - Infographic

Reduced Interest Rates

In a business environment, the more money one has on hand, the better positioned he/she is to take on the risks that come along the way. MSME loans, with their competitive interest rates, ensure that only the minimum amount is spent in repayment of the loan, and the rest is available for other business needs.

No Strings Attached

MSME loans do not require collateral from companies to be eligible for it.
The nature of small business is such that they are ‘asset light’ and can’t afford to keep their equipment as collateral.

Small businesses cannot pledge their valuable resources to banks for cash, as this can have adverse impact on their productivity, if something goes wrong. MSME loans, thus, turn out to be an ideal source of funds when the need arises.

Short-term Commitment

MSME loans are mostly utilised for short-term requirements by small businesses. This arrangement provides a certain amount of flexibility to the borrower, as there is no long-term commitment required on his/ her part. Having a short-term commitment also allows the management room to manage the cash flow and allocate available resources efficiently.

In Conclusion

MSME loans come with great benefits for small businesses, like no collateral, fast processing cycle and online account access, that meet the exact needs of small businesses at any stage of their growth.


Check your cibil score for free


How would you rate this article

 Please let us know why?

What did you dislike?

What did you dislike?

What did you like?

What did you like?

What did you like?

Next up


How a Bajaj Finserv Flexi Business Loan Can Help Your Business Grow