As we all know that business is not a term but an opportunistic platform to show your abilities or capabilities in the marketing world. If you have a desire to be your own boss by running your business successfully then government subsidy loan is going to be a great help for you.

Here we will take you to the best government loan schemes which will be beneficial for a new startup of your business or maintaining the financial life of your well-established business. In this article, we have listed all government subsidy loans for business.

What is a subsidy?

The term subsidy refers to special benefits or services which are given or provided by the governme

nt to a person, business, and organization. Subsidy generally provided or given as a cash payment or tax deduction.

Top Government subsidy Loan for business

  1. MSME business loans in 59 minutes
  2. Mudra Loans
  3. Credit Guarantee Fund Scheme
  4. Stand Up India
  5. SIDBI Make In India Soft Loan Funds For Micro Small And Medium Enterprises – smile 🙂

There are numerous government schemes are available in the market to give great support to your business. Let’s first understand.

1. MSME – (micro small and medium enterprises) business loans in 59 minutes

The MSME – (Micro small and medium enterprises) business loans in 59 minutes scheme was first invented or introduced by the government of India in September. The purpose of MSME business loans in 59 minutes was to provide financial support or help to small start-up business and large business. And there also was a demand for enhancing the MSME growth in India.

The great thing about that government subsidy loan for business is both new and existing businesses can avail the scheme for financial support up to 1 crore and has no demand for collateral requirements, in simple words collateral is valuable or precious property owned by someone who wants to borrow money.

It will take 8 to 12 days to complete the process by approving or disapproving within the 59 minutes of applications. And the interest rate is dependent on the nature of your business.

Eligibility Criteria To Get MSME business loans in 59 minutes

This MSME Government Subsidy loan scheme is beneficial for businesses which are already existed and borrowers must have six months bank statement.

Process  of MSME business loans in 59 minutes scheme

Applying for a business loan under the scheme.  Here are the required documents that you need to have to get the loan for small business or large business.

  • GST verification is one of the things that is to be done to get an approval of government subsidy loan for business.

  • Income tax verifications is another verification process to be done to get government subsidy loan.

  • Documents related to ownership of the business.

  • Bank accounts statements

  • KYC details – To verify your identity with photographs and address

  • Personal and educational details of the applicant.

Top Banks Offers MSME Loan Interest Rate

Bank Name Interest Rate Loan amount Tenure
The central bank of India 9.1% To 13.1% pa 10,000 To 5 crore Up to 10 years
Allahabad Bank 8.65% To 15.75%pa 5 crore Up to 7 years
State Bank Of India 8.1% TO 15.65%pa Up To 500 cr 15 years
Punjab National Bank 8.65% To 13.45% pa Up to 25 cr 7 years
Union Bank of India 9% To 13.75%pa 50 cr 10 years
Punjab and Sind bank 10,6% To 13.1% pa 10 cr 10 years
Oriental Bank Of Commerce 9.75% To 11.5%pa 10 lakh to 5 crore 10 years

The application process to get MSME government subsidy loan for business

  • First, you need to fill the signup process details by filling your name, email id, mobile number and use one-time password number to get verified your credentials.

  • Agree on Terms and conditions

  • You will have to fill your GST details like number and passwords

  • Uploading your past 6 months bank statements in pdf format

  • Providing company address

  • Selecting the purpose of your loan and providing the details of existing loans

  • Selecting the bank through you want the loan to be processed

  • Paying the 1000 fees including tax

  • Downloading the approval letter.

List of Best Banks Known for starting up a new business or providing Government Subsidy MSME loan:-

MSME loan can be given by a bank or non-banking financial company which does not have full banking licenses such as

  • Bank of Baroda

  • Industrial Development Bank of India(IDBI)

  • Non-banking financial companies  like Bajaj Finserv, Tata Capital

2. Mudra Loans

Mudra loan

Mudra loans is another best government subsidy loan scheme for business. Micro units development and Refinance Agency is an organization created by the government of India for providing business finance to small business (micro-units) having nine people or fewer up to 10 lakhs.

Borrowers can apply online to get this mudra loans and with mudra loans, you don’t have to think about any collateral or security to enjoy the benefits of mudra loans.

Mudra is best known for providing refinance support to small business under the scheme of Pradhan Mantri mudra yojana.

So in simple words, we can say that refinancing is replacing a loan with a new one.

This loan scheme is approved by the public sector banks, private sector banks, small banks, rural banks and etc. here loans can be provided for a funded and non-funded category.

Mudra loans come under the following categories:-

  • Shishu loans – 50,000 rs – This loan is for entrepreneurs who are thinking of starting a new business.

  • Kishor Loans – 5,00,000 rs – This government subsidy loan is for those entrepreneurs who want to expand their business.

  • Tarun Loans –  10,00,000rs – For those who want further growth for their business.

Interest Rate Of Mudra Loans:- 11.20% to 20%.

The process to get government subsidy loan for business under mudra loans

  • Identity Proof is a must if you want to avail this government subsidy loan for business and Proof of identity will include documents like PAN Card, Adhar Card, Driving licenses, Passport and Valid Photo of ID Card.

  • Address Proof documents such as bank passbook, bank account

  • You will also have to give the proof of your business by providing documents like certificates, licenses, documents confirm the business existence.

  • Providing sale made information from current FY to filling the loan application.

  • Balance Sheet

The application process to get Mudra government subsidy loan for business

  • Filing up all the mandatory sign up details

  • Choosing the business plan will give the details under which mudra loan you filled the application like Sishu loans, Kishor Loans, Tarun Loans.

  • Providing the details of identity proof in digital format. Identity proofs like Passport, Driving License.

  • Recent photographs

  • Identity and Address proof of business such as business license, tax registration documents.

List of Banks Known for providing government subsidy Mudra loan for business with their interest rates and Tenure:-

SNO Bank Name Interest Rate Tenure
1 IDBI Bank 12.75% To 13.75% 1-5 Years
2 Kotak Mahindra 11.5% To 18% 1-5 Years
3 Aditya Birla Finance Ltd 14% 1-3 Years
4 HDFC Bank 12% To 20% 1-5 Years
5 Bank Of India 12.7% To 14.7% 1-3 Years
6 Dena Bank 13% To 14% 1-3 Years
7 Indian Overseas Bank 14.07% 1-5 Years
8 Union Bank Of India 14.4% 1-5 Years

     3. Credit Guarantee Fund Scheme

Credit gurantee fund

Credit Guarantee Fund Scheme was first started in the year 2000 for providing monetary help to the small and micro business. This government subsidy loan scheme provides collateral-free financing support to small enterprises and for a well-established business and the scheme provides loans up to 10 lakh without having a requirement of collateral and the amount of guarantee covers is 85% for small businesses for credit up to 5 lakh.

The ministry of small, medium, micro, the government of India and small industry development bank of India collaboratively invented a trust called as credit guarantee fund trust for micro and small businesses.

GSTMSC has also brought various structural changes in the current guarantee scheme which would make the scheme more fruitful to MLIS.  Let’s talk about the Credit Guarantee Fund Scheme’s eligibility.

Eligibility Criteria to get this Government Subsidy Loan For business

Following eligible enterprises are mentioned below to avail credit guarantee fund

  • For small, medium, micro business

  • Retailers who are engaged in providing goods and services directly to customers.

  • Educational institutions

Banks provide CGFC – public, private and foreign sector banks are trusted lenders here

  • Kerala financial corporation

  • SIDBI – small industries development bank of India

  • Export-Import Bank of India

  • The Tamil Naidu industrial commercial corporation Ltd.

  • Jammu and Kashmir Development Finance corporation

  • Delhi Financial corporation

  • 4 foreign banks

  • 21 private sectors banks

Process To Get Credit Guarantee Scheme

  • First, you need to prepare your business plan
  • After preparing your business plan second thing comes up is selecting the lender bank
  • Then Submitting the application
  • Bank will verify the details provided by you in the application
  • After verifying the details, there will also be further verification process done
  • Once the verification process completes, then the bank will release the funds for a business.
  • After getting the approval you will have to pay its fee.

4. Stand Up India

stand up india

The scheme stand up India makes the bank loans easier between 10 lakh and 1 crore for at least one Sc or ST borrower and for one woman borrower per bank branch for starting up greenfield business. Basically, a greenfield business is a process of building the new company on pasture.

Stand up India scheme’s objective is to promote entrepreneurship among women and scheduled caste and tribes which was started by the Indian government.

Stand up India scheme is Fruitful to facilitates the bank loan between 10 lakh to 1 crore, also make the loan easy for non-individual enterprises where 51% of the shareholding is held by ST/SC or woman entrepreneur.

And the one important thing about this stands up India is having a requirement of collateral. Stand up India repayment tenure has a time period of maximum seven years.

Let’s know more about regarding its eligibility, banks which provide the scheme, process to get the scheme and more.

Interest Rate:- Banks MCLR – the marginal cost of fund-based lending rate+3%+tenor premium.

Eligibility Criteria to get this government loan subsidy

  • Enterprises who engages in trading and manufacturing or services.

  • This government loan subsidy provides a loan only for greenfield projects. A greenfield project refers to building new infrastructure on unused land without any need of demolition or destruction.

  • The borrower must not be a defaulter in any banking institution

Banks provide stand up India scheme-

List of banks which facilitate government Subsidy loan for business under Stand Up India Scheme are categorized in public and private sector bank.

  • Allahabad Bank – Public Sector Bank

  • Axis Bank – Private sector Bank

  • Bank of Baroda – Public Sector Bank

  • Bank of India – Public Sector Bank

  • Canara Bank – Public Sector Bank

  • Corporation Bank – Public Sector Bank

  • Bank of Maharashtra – Public Sector Bank

  • Central Bank of India – Public Sector Bank

  • Andhra Bank – Public Sector Bank

Process and Documents To Avail Stand Up India Scheme

  • Identity Proof is mandatory

  • Residency proof including Recent electricity bills, telephone bills, voter Id cards

  • The requirement of Business Address proof

  • Agreement of rent if a business runs on rent

  • Balance sheet for the next two years is required

  • Photocopies of collateral securities

  • Documents Regarding SC or ST category

5. SIDBI Make In India Soft Loan Funds For Micro Small And Medium Enterprises – smile 🙂

SIDBI(Small Industry Development Bank of India) make in India soft loan for small-medium business was established by late Mr. Arun Jaitley and the significant objective of SIDBI make in India loan is to take forward the government of India’s Make in India campaign and help MSME to participate in the scheme and also has taken up the step to provide financial assistance to business in India.

SIDBI Make in India government subsidy loan scheme for the business is considered giving benefits to approx 13000 enterprises.

SIDBI Make in India objective is to provide a soft loan with term loan nature, a term loan is basically a monetary loan and is needed to be repaid in regular basis in a certain period of time. And the loan amount is provided under this scheme minimum 10 lakh rs for equipment finance. General equipment finance is basically making the best use of your loan by purchasing or borrowing assets for a business.

Interest Rate:9.15% To at 9.35%  for a soft loan.

                                 9.45% To 9.95% for a term loan.

Eligibility Criteria To Get This Government Subsidy loan

New organizations in manufacturing and service sector can apply for SIDBI make in India soft loan including new enterprises.

Conclusion:-

The business has a lot to understand and follow to lead a good business life. And the thing is business strategies are enhancing and changing day by day so, we need to keep these strategic enhancements in our mind and need to take or follow proper steps to get more benefits out of it.

Government loan schemes are helping the micro, small and medium enterprises by giving them financial support to fulfill their day to day expenses. With the collaboration of public sector banks and government institution together loan schemes are getting more popular and easy-going process among business owners.

we have completed our task describing you all the productive government subsidy loan schemes for business whether it is small, micro or large. Besides we have also shared the banks which provide these government subsidy loans schemes for business with their interest rates. So, After observing necessities or requirements for your business go with the best scheme you want for your business.

Related post

Leave A Comment