The Government of India offers various schemes for Indian businesses to grow. These Government Business Loan schemes aim to support the businesses financially, empower them to spur economic growth and create more employment. In this blog, let’s check out the top 5 government schemes that can help your business extension. Read on!
5 Best Government Business Loan Schemes
Here are the 5 most popular government schemes that will help you reach your financial goals:
Pradhan Mantri Mudra Yojna (PMMY)
Pradhan Mantri Mudra Yojna or PMMY is one of the most popular Business Loan schemes launched by the government in the year 2015. The scheme mainly caters for trading organisations, service-oriented enterprises and women entrepreneurs to encourage them by offering them financial assistance. This scheme provides collateral-free loans with different loan amounts to help them start or expand their business.
PMMY categorizes loans into three segments based on the stage of business growth:
- Shishu: This loan scheme offers an loan amount of up to ₹50,000 for budding entrepreneurs.
- Kishore: With this scheme you can avail of a loan amount between ₹50,001 and ₹5 Lakhs for growing businesses.
- Tarun: Under this scheme you can get a loan amount between ₹5 Lakhs and ₹10 Lakhs for established enterprises.
The Government of India has recently added a new category of loan under Pradhan Mantri Mudra Yojna which was announced in the Union Budget 2024-2025. By introducing this new category called Tarun Plus, which supports entrepreneurs who have successfully repaid the previous loans, can now get a loan of up to ₹20 Lakhs to expand their business.
National Small Industries Corporation (NSIC)
The National Small Industries Corporation provides financial assistance to businesses in areas like technology, marketing and finance. This scheme provides essential support to businesses to grow and thrive. Here are two NSIC schemes available for businesses:
1. Marketing Support Scheme
In this scheme the government assists the enterprise with consortium plans, tender marketing, and other marketing-related activities.
2. Credit Support Scheme
The government extends credit support for marketing, raw materials, and other working capital requirements.
SIDBI Loan
The Small Industries Development Bank of India (SIDBI) offers various loan schemes designed to support Micro, Small, and Medium Enterprises (MSMEs) in India. These loans help businesses with working capital, machinery purchases, expansion, and green finance.
Here are 4 schemes offered by SIDBI:
- Machinery Loan: The loan helps MSMEs upgrade or purchase new equipment.
- Green Finance Loan: This supports businesses adopting eco-friendly practices.
- Project Loan: The loan provides funding for business expansion and infrastructure.
- Working Capital Loan: SIDBI assists with day-to-day operational expenses.
Credit-linked Capital Subsidy Scheme
The Credit-linked Capital Subsidy Scheme in the government initiative designed to support micro small industries to upgrade their technologies. The scheme offers the businesses a subsidy of 15% on institutional finance of up to ₹1 Cr, with additional incentive to SC/ST entrepreneurs and those from aspiration districts.
PSB Loan in 59 Minutes
PSB Loan in 59 Minutes is a government-initiated scheme that helps MSMEs to secure a loan from public sector banks in just 59 minutes. The loan was introduced to reduce the traditional loan processing time, physical bank visits and give quick access funds seamlessly for both new and prevailing businesses.
These are a few top government-initiated schemes for business loans. In the next section let’s understand how you can secure funds for your business urgently.
To Conclude
The government of India offers a wide range of schemes to help your business to grow and expand. From the Pradhan Mantri Mudra Yojna supporting new and established enterprises, to the SIDBI loan offering tailored financing solutions, these initiatives provide crucial financial assistance to businesses across sectors. Additionally, the Credit-linked Capital Subsidy Scheme helps small industries upgrade their technologies, while the PSB Loan in 59 Minutes ensures quick and streamlined access to funds.
However, if you are looking for a trusted financial institution who offers quick access to funds and requires minimal documentation for processing, apply for Poonawalla Fincorp’s Business Loan and take your business to the next level. Apply now!
Frequently Asked Questions
1. What is the credit score requirement for a Business Loan?
Generally, lenders accept a score of 750 and above to process your Business Loan.
2. What are the documents required for getting a business loan?
The documents required for a Business Loan vary from lender to lender. However, at Poonawalla Fincorp you must submit – KYC document, business address proof and financial documents.
3. Can I apply for a loan from home?
Yes, with Poonawalla Fincorp, you can apply for a loan from your home or any other place at any time.
About the Author
We take utmost care to provide information based on internal data and reliable sources. However, this article and associated web pages provide generic information for reference purposes only. Readers must make an informed decision by reviewing the products offered and the terms and conditions. Loan disbursal is at the sole discretion of Poonawalla Fincorp.
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