Starting a new business is never an easy thing to do. It requires a lot of hard work. However, before you even start working, you need capital to begin the process. However, we all know how business loans carry a substantial interest rate which is not suitable for a business person who is just going to start the business.
The other things, generally people are not aware of the business loans, which are offered by the government. This is why, in this blog today, we will mention some of the best government loan schemes for small businesses. Now, let’s get started.
Mudra loan
We will begin with Pradhan Mantri Mudra Yojana. It is an initiative started by the Indian government to boost micro and small businesses. In mudra loan, the loan is offered up to Rs 10 lakh. The loan is offered without any collateral. The loan is divided into 3 categories.
Shishu loans - The loan amount is offered up to Rs 50,000.
Kishor loans - The loan amount is offered up to RS 5 lakhs.
Tarun- The loan amount is offered up to Rs 10 lakh.
There are many governments, and private banks offer the loan. There is SBI e Mudra loan, HDFC mudra loan and other mudra loans.
Credit Guarantee Scheme
This is like a big brother of the Mudra loan. Credit guarantee scheme is an initiative by the government of India, to strength the MSME sector. From the regional rural banks to the national and foreign banks offer the loan. Those who are in the manufacturing or service sector, agricultural, training institutions and self-help groups are eligible to apply for the loan. Let’s check out some of the details.
The loan is offered up to 2 Crore.
There is 80% credit facility for the loans to Sikkim and North Eastern Region.
Stand-up India
An initiative by the Small Industries Development Bank of India(SIDBI), the funding is offered to those who belong to SC/ST category. It is available for women too. The loan is offered from RS 10 lakhs to 1 crore. Those who are in the service or manufacturing sector are eligible for the scheme. If there is a non-individual enterprise, it is necessary that 51% of the shareholding stake should be with the women or SC/ST entrepreneur.
The loan amount is offered from Rs 10 lakhs to Rs 1 crore. It will cover 75% the project.
The rate of interest will be the lowest interest rate applicable to the loan.
MSME business loans for start-ups in 59 minutes
An Initiative by Credit Guarantee Fund Trust for Micro and Small Enterprises(CGTMSE), it aims to offers the loan at the lowest rate. The process is quick, offering loan approval within 59 minutes of applying. As a borrower, you are independent to choose the bank of your choice. The loan amount gets disbursed within 6 or 7 days after the verification gets completed.