Startup Funding & Business Loans

Ever since the Startup India campaign was announced in the year 2015, the number of new Micro, Small & Medium Enterprises (MSMEs) has been on the rise. The campaign is based on an action plan aimed at promoting bank financing for Startups and new businesses. It has encouraged startups, which will eventually lead to more job creation, equity and shall help in the nation’s socio-economic growth. Several leading financial institutions offer Startup loans for new businesses at low interest rates. Find below the details of loans schemes initiated by the Govt. of India over the past few years:

1) Startup India

Startup India Scheme is an initiative by the Government of India that offers instant business loans for startups for growth and expansion. Other key functions of Startup India include the promotion of Startups, wealth creation, and employment generation. Register with Startup India to avail business loans at attractive interest rates.

2) Stand-up India

Stand-Up India Scheme offers funds to people who come under the SC/ST category and women entrepreneurs of the society. Stand-up India scheme was initiated by the Government of India to provide credit services, majorly to SC/ST category people. The primary purpose of this scheme is to help banks by offering loans between Rs. 10 lakh and Rs. 1 crore to at least one SC/ST applicant and one women entrepreneur, per bank branch enabling them to start their own business.

3) psbloansin59minutes.com

The Government of India has launched a web portal that approves business loan applications in just 59 minutes from the time of submission. The minimum loan amount offered under this scheme is Rs. 10 lakh and the maximum is up to Rs. 5 crores. The interest rate offered by Banks/NBFCs under this scheme starts from 8.50% p.a.

4) MUDRA Loan

Mudra Yojana under Pradhan Mantri Mudra Yojana (PMMY) offers loans up to Rs. 10 lakh without asking borrowers for any collateral at affordable interest rates. The repayment tenure is up to 5 years and the processing fee is Nil to nominal. There is no minimum loan amount criteria to borrow. The interest rates shall vary from bank to bank, depending upon the applicant’s profile and business requirements.

5) CGTMSE Scheme

Credit Guarantee Funds Trust for Micro and Small Enterprises (CGTMSE) is another Government initiative that offers funding to MSMEs via financial institutions like banks and NBFCs. Under this scheme, first-time entrepreneurs and startup enterprises are majorly benefitted. The loan offered under the CGTMSE scheme is collateral-free.

6) SIDBI’s Growth Capital and Equity Assistance Scheme

Entrepreneurs can now avail this distinct type of funding for their startup from the banks. Many banks and financial institutions offer loan schemes that are specifically designed to fund startups and their special needs. Different banks may assign different names for these Startup Business Loans.