The MSME (Micro Small and Medium Enterprises) sector in India is expanding at a very fast pace and because of their increasing expansion, the Government time and again introduces new business loan schemes for this sector. The loan schemes are initiated through some of the programmes as mentioned below:

A. MUDRA (Pradhan Mantri Mudra Yojana)

MUDRA is a government based scheme which boosts the entrepreneurial sector in India. In collaboration with the NBFCs, regional and private banks, MUDRA helps to refinance the small business enterprises. The interest rates of Mudra vary depending on the category one wishes to apply for. The categories are divided into Shishu, Kishor and Tarun

Shishu: covers loan amount up to Rs.50, 000

Kishor: covers loan amount above Rs.50, 000 to Rs.5, 00,000

Tarun: covers loan amount above Rs.5,00,000 to Rs.10,00,000

According to the business requirement, one can apply into one of the above mentioned categories and can avail the loan amount once their loan application is accepted.

If one wants to start a new business venture in the field of transportation, Shop keeping, Trading, Equipment financing units for your business loan can apply for a Mudra loan.

How to apply for Mudra loan scheme:

The loan applicants have to take the following steps in order to apply for this loan:

  1. It is important to keep the documents intact before applying for this loan. Mandatory documents like Aadhaar, PAN, and Voter ID are important for identity and address proof.
  2. Once the documents are completed, you can approach your bank and the bank officials will guide you with the appropriate Mudra loan scheme.
  3. Fill the Mudra loan application and select the category under which you want to apply.
  4. Once the entire documentation is complete, the bank will sanction the loan according to your financial requirement.

B. PSB loan in 59 minutes

Another initiative by the Government of India was the introduction of PSB loan in 59 minutes. The idea behind this programme was to ease the loan process and reduce the entire time that a loan usually takes. PSB loan in 59 minutes offers loan amount starting from Rs.10 lakh to Rs.1 crore to individuals who require business loan for any small or big loan requirement. The interest rate of PSB Loan in 59 minutes starts from 8% onwards.

How to Apply for PSB Loan in 59 minutes

If you are looking for a business loan with a fast process and approval, this loan might be a good option for you. Here is how you can apply for the same:

  1. Log on to www.psbloansin59minutes.com
  2. Register with your credentials which will be followed by registering with OTP.
  3. Enter The OTP sent on your mobile number.
  4. Agree to the Terms and Conditions as mentioned
  5. On agreeing to the T&C, you will have to create a new password. Your account will then be set up post which you can apply for this loan.

C. National Small Industries Corporation

National Small Industries Corporation or NSIC was introduced by the Government of India to promote and foster the MSME sector in the country. NSIC aims to be one of the main organisations which provide a push to the business enterprises in the country. NSCI has some tailor made schemes like Bank Credit Facilitation, Raw Material Assistance, Single Point Registration, National SC and ST Hub, Procurement and Marketing support, Infrastructure etc.

How to apply for NSIC

To apply for NSIC, you can log on to their website, www.nsic.co.in. The website provides complete guide on all the schemes that are offered and you can apply for the scheme that your business requires.

D. Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)

To provide an initial support to the entrepreneurs for setting up their own business unit, CGTMSE was introduced by the Government of India which eased the process of applying for different business schemes. CGTMSE provides collateral free loan to the business entrepreneurs so they can repay the loan amount without defaulting.

Scheduled Commercial Banks, NBFCs, Small Finance Banks, Private Banks are eligible to apply for CGTMSE.

How to apply for CGTMSE

You can follow a few steps in order to apply for the loan schemes under CGTMSE.

Prepare a business plan under which all your business requirements are mentioned. Once you have a plan ready, you can apply with the bank that offers CGTMSE loan schemes. Your bank officials can guide you with the best loan scheme that CGTMSE offers. Once all the documentation is complete, your loan procedure will start and the amount will be sanctioned in a few days.

E. Small Industries Development Bank of India (SIDBI)

Another initiative to ease the cash flow in the MSME sector was the introduction of SIDBI.

SIDBI’s main idea is to maintain an equal balance between the financial lenders and the business entrepreneurs. SIDBI has different loan scheme for different categories –

Direct Loans, Venture Capital, Indirect Finance, Fixed Deposit, Micro Lending. The loan schemes are designed specifically for different purposes be it refinancing directly or indirectly.

How to apply for SIDBI

To apply for loan schemes under SIDBI, you will first need to register with SIDBI on their website www.sidbi.in and once you have made an account, you can fill the loan application and submit it online.

F. Stand Up India Scheme

Stand Up India loan scheme facilitates economic growth and provides loan to the SC, ST and to the women borrowers for setting up a project where there is no need of remodelling it. The loan amount starts from Rs.10 lakh to Rs.1 crore. The tenure of Stand up India is 7 years. SC, ST or women entrepreneurs above the age of 18 can apply for Stand up India loan scheme.

How to apply for Stand Up India loan Scheme

To apply for Stand Up India loan scheme, you can either contact your bank and the bank officials will help you with this loan scheme or you can even visit the Stand Up India website www.standupmitra.in to apply for the loan scheme. You need to create an account for new applicants and then fill the loan application as per your business preference.

There are many Government based business loan schemes that are accessible today to all of us. Most importantly they serve the purpose of promoting the MSME sector providing the right financial guidance. If you are looking for business loan with affordable fees and charges, the options mentioned above might just be the best options for you.

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