Business Loan

How can you Avail of Government Loan Schemes for Your New Business?


Want to find out more about the government loan scheme? How does the government start loans? How to take advantage of government loan programmes? MSMEs are the key to a country’s economic growth (Micro, Small and Medium Enterprises). MSMEs can always find a way to solve big economic problems like poverty, unemployment, income inequality, and imbalances between regions. Its most important job is to make sure that everyone has the same amount of money and that local development is fair. This industry employs a lot of people in our country and makes use of local talent, both of which are important parts of the country’s GDP.

At the moment, about 11.10 crore jobs in India are provided by the MSME sector. This is why this sector is also called the growth engine of India. MSMEs make up 8% of the country’s total GDP, 40% of its total exports, and 45% of its manufacturing output. Both the organised and unorganised sectors have MSMEs.

Government Loans to Businesses

The MSME sector is the most important part of the Indian economy. People know that this sector makes up almost 30% of India’s GDP and creates most jobs there. The government of India offers different credit programmes to help the MSME sector grow. It is important for India’s growth and plays a role in it. Government loans can help small and medium-sized businesses get the right amount of money they need. The Indian government’s start-up business loan programme makes it easy to get the money to turn good business ideas into profitable businesses.


  • Government loan scheme programme, which is also called “PSB Loan in 59 minutes,” was started by the government of India. It set up a quick business government loan scheme portal for people who want to grow their businesses. Under this programme, public and private sector banks and NBFCs can lend INR 1 lakh to INR 5 crores to MSMEs. You can get the money you need in the time you need it.
  • Which business can get a loan through this programme? Some things decide if a business is allowed.
  1. Income/revenue.
  2. The ability of the borrower to pay back the loan.
  3. Credit facilities are already in place. 
  4. Other things that the lender of the money decides.
  5. There are also other good things about this plan;
  6. The whole process of getting a loan should be super fast and only require a few papers.

The government scheme loan is processed without any help from a person when the loan is approved. So, it is called a scheme for Advanced Technology Backed Loans.  When someone applies for a loan, their information needs to be kept safe and secure at the highest level of security.

  • The Micro Units Development and Refinancing Agency Ltd. It is in charge of the Pradhan Mantri MUDRA Yojana. Under this scheme, MUDRA helps banks and NBFCs refinance their loans to micro units that need loans of up to INR 10 lakhs. Under PMMY, MUDRA divided the loan into three categories called “Shishu,” “Kishore,” and “Tarun” to show the stage of growth or development.
  • A plan to help small and medium-sized businesses get loans with guarantees. The Government of India started the CGTMSE business loan programme. The MSME sector could get credit without putting up collateral. It includes both new and existing businesses. The CGTMSE scheme is run by a trust called Credit Guarantee Fund Trust for Micro and Small Enterprises. It was set up by the Ministry of MSMEs and the Small Industries Development Bank of India (SIDBI). Under this funding programme, MSMEs can get loans of up to INR 200 lakhs, and eligible women get priority.  The Guarantee Cover can cover up to 85% of the amount of the credit facility that has been approved. The trust funds charge a fee of 1% of the amount approved each year. 0.75 per cent for loans up to Rs. 5 lakh, 0.85 per cent for loans over Rs. 5 lakh but up to Rs. 100 lakh. According to the eligibility criteria, this scheme is for businesses that do the following, whether they’ve been around for a while or just started up.
  • The National Small Business Administration (NSIC):  NSIC is an Indian government business that is ISO-certified and works with MSMEs. It works to help and encourage the growth of micro, small, and medium-sized enterprises (MSMEs) by providing combined support services in finance, marketing, technology, and other related services all over the country. To help MSMEs grow, NSIC offers several programmes.
  • Marketing Support Scheme: Help with marketing is important for the growth of any business. It is especially important for the growth of MSMEs in today’s highly competitive market. To help these kinds of businesses, NSIC came up with programmes like Consortia and Tender Marketing. NSIC puts together groups of MSMEs that work on their behalf to make things easier for them. These groups are called “Consortia of MSMEs.” NSIC also sets up “Marketing Intelligence Cells” to spread the word about different programmes for MSMEs. 
  • Credit Support Scheme: Under this scheme, NSIC helps MSMEs get the money they need to buy raw materials, do marketing, and spread the word about their products.
  • The Credit-Linked Capital Subsidy government loan scheme (CLCSS):  CLCSS is a new credit programme started by the Ministry of MSMEs. Its main goal is to help MSMEs, especially in rural and semi-urban areas, improve their technology. Under this plan, businesses can get a 15% subsidy if they buy machinery that meets certain requirements. But there is a limit on how much the subsidy can be, which is INR 1 crore.


India has about 40 million registered and unregistered Micro Small and Medium Enterprises (MSMEs).  Both the organised sector and the unorganised sector include MSMEs. About 40% of India’s GDP comes from these MSMEs, and they continue to be an important source of jobs. The MSMEs help solves important problems in the country, such as poverty, unemployment, etc. Small and medium-sized businesses (MSMEs) are run by entrepreneurs who can get a loan from any of the schemes that fit their needs.

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