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Sunday, October 1, 2023

Learn About the Best Small business loans you can get as a businessman

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The Government of India, as well as several lending institutions, provides financial assistance to business owners under the aegis of small business loans. These loans are typically useful to finance diverse funding objectives for improved turnover and overall growth of a business. A study shows that almost 95% of total business units in India comprise small and medium business enterprises that significantly contribute to nearly 6.11 % of total manufacturing GDP of India.

Hence, it is quite evident that Small and Medium Enterprises (SMEs) serve as the drivers of the country’s economy. Individuals looking for a suitable business loan to fulfil the entrepreneurial funding needs can consider the following funding options to pursue.

The most preferred business loan options in India

Availing a business loan constitutes an integral part of creating a growth plan for small business. The government and various financial institutions have thus introduced various funding schemes to drive growth for the SMEs and MSMEs. Such widespread funding opportunities encourage business owners to expand and grow their business. As a result, it impacts the economic graph of the nation positively. 

  • MSME business loans 

There has been a consistent emphasis on the improvement of micro, small and medium enterprises as it is one the critical contributors to the economic growth of the nation. MSME business loans have thus been a unique funding initiative that simplifies the complete process of loan approval and disbursal.

Borrowers can thus get their approved small business loans approved within a few minutes against the right eligibility. Also, borrowers can receive disbursal of the high-value advance of up to Rs.25 lakh within a day of receiving approval. Not to mention, they come with competitive business loan interest rates.

  • MUDRA loans     

One of the convenient ways to boost a slow-moving business is to avail a MUDRA loan for liquidity infusion to the business that ensures smooth running of the organisation. This scheme, inaugurated in 2015, offers loans of up to Rs.10 lakh to non-farming, non-corporate micro and small business enterprises. Based on the total loan amount, this scheme is further classified into three segments, named Sishu (up to Rs.50,000), Kishore (Rs.50,000 to Rs.5 lakh) and Tarun (Rs.5 lakh to up to Rs.10 lakh). 

Moreover, borrowers can select the lender for this advance as per their choice. Also, the business loan interest rates are quite affordable, that makes repayment of this advance affordable.

  • Loans under the Credit Guarantee Fund Scheme for Micro and Small Enterprises 

Availing small business loans is one of the most preferred ways to raise funds for a business. Given the demand for such in consideration, the government also launched CGMSE for micro and small-scale enterprises. The most vital advantage of this scheme is that it is collateral-free funding up to a loan amount of Rs.10 lakh.

  • Loans under National Small Industries Schemes

Another government scheme to boost the growth of SMEs across the nation is allowing entrepreneurs to enjoy a total of 15% capital subsidy so that they can bear their business expenses without much financial constraint. The Credit Link Capital subsidy scheme offers a loan up to Rs. 15 lakh. This particular scheme covers two significant factors of a business, i.e., raw material and marketing. Assistance in both these aspects comes under the ambit of this scheme. 

Therefore, individuals who cannot afford high interest rates can readily opt for this scheme to achieve their business goals.

These are a few favourable small business loans options that business owners can avail without stressing over the repayment of the loan amount. They must, however, meet the eligibility requirements and keep the necessary documents handy for hassle-free application processing.

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