Government has introduced various schemes to provide loans to small entrepreneurs. Business owners can avail loans from Mudra, MSME scheme and many other schemes introduced by government. This article explains various loan schemes by government.
Small businesses contribute to economy of a country. Government understanding that MSMEs are backbone of economy has introduced many schemes to provide small and big loans. MSME sector contributes to economy, job market and tax collections and is backbone of country.
Here are top schemes launched by government to provide loans to MSME sector.
Mudra loans were launched by Prime Minister to enable small businesses avail loans from banks. Mudra loans are for micro business units and max loan allowed is Rs. 10 lakhs.
Various categories under Mudra Loan are:
Stand Up India scheme was launched to uplift the SC, ST and women entrepreneurs. Under this scheme SC, ST and women business owners can apply for loan from Rs. 10 lakhs to Rs. 1 crores. People from Scheduled Caste or Scheduled Tribe can apply for loan under this scheme and can avail up to 75% of project cost.
Every bank need to provide at least one loan under this scheme to SC/ST/women entrepreneur. Loan under this scheme are provided to trading, manufacturing or any other sector.
New or existing business units can avail loan up to Rs. 2 crore under CGFMSE scheme. This scheme was launched by government of India to provide working capital loans to existing or new business. Credit Guarantee Fund Trust is established under MSME ministry to implement CGFMSE scheme.
Under this scheme loans are provided without any collateral. Under this scheme guarantee up to 85% is provided on loan.
A fee upto 1% is charged by fund on availed facility amount. This facility can be availed by Retail traders, wholesalers, manufacturers and service sector.
National Small Industries Corporation is a body corporate established by government to help MSME. NSIC helps MSME through various ways such as Finance help, Technology help, Marketing help and other services.
NSIC has started 2 schemes to help MSMEs grow.
CLCSS scheme was launched by government to help rural and semi-urban industries upgrade to latest technology. These scheme provides upto 15% subsidy on capital procurement to upgrade technology or modernise business.
The main focus of this scheme was to enable small industries improve their product methods to reduce cost and improve technology.
Subsidy can be availed to purchase plant and machinery. Maximum amount under this scheme is set at Rs. 15 lakhs.
Women Development Corporation under government introduced this scheme to empower women business owners. The scheme aims to help women start their business.
Under this scheme a loan up to Rs. 15 lakhs can be availed to start a business.
Woman between the age 18 and 55 can apply under this scheme and annual income of family should not be more than Rs. 15 lakhs. However, their is no income cap for women who are physically challenged or widowed.
You can apply under above schemes or for direct business loan. You will require project report for loan. You can generate project report using Banking91 tool.
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