The Government of India is providing many schemes for small businesses for their financial help. In this article, we will tell you about the best small business subsidy loan in India you should know about.
1. Loans/Subsidy for Micro and Small Enterprises by SIDBI
2. SIDBI has a scheme for MSMEs. The scheme was launched in 2015 and it offers loans to small businesses at an interest rate of 9.5%. The loan amount is up to Rs 10 lakh per project with an expected repayment period of five years. The minimum investment required for this scheme is Rs 50 lakh which can be used towards setting up a new factory or expansion of an existing one; however, the maximum investment allowed under this scheme is Rs 2 crore per project. *
3. Loan/Subsidy for Micro and Small Enterprises by SIDBI:
SIDBI offers a subsidy worth Rs 25 Lakhs per worker hired through its Micro Enterprise Development Fund (MDEF) program that provides basic inputs required by a micro business along with training support during their start-up phase to ensure growth potential among them. *
Mudra Bank is a public sector bank, which means it is owned by the government and provides financial services to small businesses. The bank has a loan scheme for small businesses, called the 'MUDRA Bank' Scheme. This scheme offers loans at interest rates lower than market rates to help these companies grow their businesses and become competitive in their markets.
The MUDRA Bank also offers subsidies on parts of the loan repayment along with other benefits such as free office space, meeting rooms, and utilities.
Credit Guarantee Fund Scheme for Micro and Small Enterprises (CGMSE)
The Credit Guarantee Fund is a scheme of SIDBI. This is an interest subsidy scheme that provides loans to MSMEs in India at a subsidized rate of interest. The loan amount, however, must be repaid with an amount equal to or greater than the original principal borrowed plus interest within three years from the date of disbursement and maturity date mutually agreed upon between you & your creditor.
The CLCSS is a financial support scheme for micro and small enterprises. It provides loans to businesses that are unincorporated, new, or existing with less than five years of existence. A maximum of Rs 50 lakhs can be loaned under this scheme to an applicant company per year with an interest rate of 7% per annum along with other conditions like repayments at maturity only after landing up in profit status or being sold within three years of approval of loan amount - whichever is earlier
Stand Up India is a scheme launched by the Government of India in 2015. The scheme aims to promote entrepreneurship among the SC/ST communities and women. Under this scheme, the government provides capital subsidies of up to Rs 1 crore to SC/ST entrepreneurs and women entrepreneurs.
The government has already approved over 30000 applications under this scheme through various banks across India including State Bank of India (SBI), HDFC bank, etc., with an investment limit ranging from Rs 10 lakhs - 50 crores with an annual interest rate ranging from 7%–10%.
The Pradhan Mantri MUDRA Yojana (PMMY) is a scheme that provides financial assistance to non-corporate, non-farm small businesses. It offers loans at an interest rate of 8%.
It can be used for any kind of business including manufacturing, trade, and services.
PMEGP is a credit-linked subsidy scheme for the creation of new employment in rural areas. The scheme was launched on 25th January 2015 and has been introduced as per the recommendations made by the 7th Pay Commission report.
The objective of this program is to provide employment opportunities to youth who are unemployed or underemployed in rural areas of India so that they can contribute towards the economic growth and development of our country.
The scheme is applicable for the purchase of plant and machinery to MSMEs in specified industries. The maximum amount that can be availed under this scheme is Rs. 2 lakhs per year and only one such investment per financial year can be made through this subsidy scheme.
The eligibility criteria for availing of this subsidy are:
1. You have to have a turnover of less than Rs. 50 crores;
2. You must have an annual income below Rs. 15 crores; finally,
3. Your investments must not exceed Rs 20 lakhs during any financial year
Capital Investment Subsidy for SSI units located in Backward Areas by the Government of India
Capital investment subsidy is a government scheme, which provides financial assistance to small-scale industries that are located in backward areas. The objective behind this scheme is to encourage investments in these areas and promote economic development there. The amount of subsidy depends upon the size of your business, the location of your factory, and the type of industry you are running (it can be anything from leather tannery to cotton textile). The maximum limit for capital investment subsidy per year is Rs 50 lakhs, which means that if you want to get more than this amount then you will have to apply for it separately instead of applying for both subsidies together as one package deal.
If you are looking for a quick loan to start your own business or grow an existing one, this list of the best small business subsidy loans in India should help you. The government is offering these schemes so that entrepreneurs can get some financial help and grow their businesses.
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