An essential part of starting and building a business is to get the financing right. With solid capital available, your business will have a good chance of constant inflow. Well established and larger businesses use multiple ways to raise funds. But the options for MSMEs are limited, and raising finances for the business can become tough. The optimal choice is MSME loans for new businesses.

The primary difference between small and large-scale businesses is the magnitude of investment. The government maximum capital regulation to turnover ratio for Micro Small Medium Enterprises is 1:5 in crores. Any business that exceeds these limits won’t be qualified for MSME loans.

MSME Loan

MSME loan is popularly known as an under 60 minutes loan. It is a financial scheme introduced by the government to boost its economy and help MSME businesses grow. The maximum capital you can avail of for a loan is one crore. While without collateral, the loan can be sanctioned in 60 minutes; otherwise, the entire procedure will be done in two weeks. The procedure finishes quicker when done online. The interest rate is directly proportional to the magnitude and type of work.

How to Apply for an MSME Loan

You can apply online by following these simple steps.

Fill your application: make sure to fill in relevant and accurate personal, financial and professional details. After the application is processed, the lender will contact you within a designated time.

Documents: Once your application has been reviewed, you must upload your documents to the site or app. The team will notify you once your documents are verified.

Sanctioning: After successful verification, a loan agreement will be sent to you, outlining the term and conditions and the MSME loan interest rate and repayment tenure. As soon as the signed contract is received, the funds will be disbursed to your bank account. Disbursement generally happens in 24 hours.

Additional Read: Challenges of Availing an MSME Loan