The growth of an economy depends on its MSMEs, i.e. micro, small and medium enterprises. Currently, the MSME sector provides around 11.10 crore of jobs across the country, contributing 8 percent of overall GDP. In fact, these small businesses are responsible for about 40 percent of the country’s total exports and 45 percent of manufacturing output.Read also – GST Council Meeting: FM Sitharaman May Postpone Textile and Footwear Tax Hike
Yet like all start-ups, MSME entities face many obstacles in obtaining the right kind of financial support for existing business activities or for expanding their business. Read also – CES airlines offer airline tickets starting at Rs 1,122 to boost booking. Details here
We bring you the 5 best government loan programs that can help MSMEs with financial assistance Read also – Interest rates for retirement: here are the main changes to banking rules as of December 1
MSME loan in 59 minutes
This program, also known as the 59 Minute PSB Loan, was introduced to get fast business loan for people who need to grow their existing business.
Under this program, MSMEs can obtain loans ranging from 1 lakh INR to 5 crore INR in less than 59 minutes at an interest rate of 8.50% from public and private sector banks and NBFCs.
Pradhan Mantri MUDRA Yojana (PMMY)
The MUDRA program provides refinancing support to banks and NBFCs for loans to micro-units with loan needs of up to 10 lakhs INR under 3 categories like “Shishu”, “Kishore” and “Tarun” to signify the stage of growth / development. Under this program, credit is provided in the form of a commercial loan for vendors, traders, traders, commercial vehicles and equipment financing for micro-units.
Micro and Small Business Credit Guarantee Fund System (CGFMSE)
CGFMSE is a government business loan program that provides unsecured credit to the MSME sector. It includes both existing businesses and new businesses. Under this funding program, MSMEs have access to a loan amount of up to INR 2 crore with particular preference for eligible women.
National Small Industries Company (NSIC)
NSIC is an ISO MSME certified Indian government company. The NSIC assists and promotes the growth of MSMEs by providing financial, marketing, technological and other related services to encourage the growth of MSMEs.
Under this program, small industries can benefit from marketing assistance, which is crucial for the growth of MSMEs in the current intense competitive market, and from the credit support program which helps finance the supply of materials. premieres, marketing financing and syndication financing with banks for MSME.
Credit Linked Capital Grant Program (CLCSS)
The main objective of the credit-linked capital grants program is to assist in the technological upgrading of MSMEs, especially in rural and semi-urban areas. Under this program, CLSS companies can opt for a 15 percent subsidy on investment in qualifying machines. However, there is a maximum cap on the grant which limits it to INR 1 crore.