7 Ways MSMEs Can Apply For a Business Loan

MSMEs or ‘Micro-Small-Medium’ Enterprises often need to back their business ideas up with sufficient funds, sourced either from personal reserves or via MSME loans. While the latter puts the existing financial state in jeopardy, MSME loans are nothing but high-interest instruments and that too with capped limits. This is the reason why you should try for an MSME loan by connecting with a reliable and considerate financial institution.

7 Ways MSMEs Can Apply For a Business Loan

Things to know before considering an MSME Loan

Before you apply for a loan, you must first check the business loan eligibility criteria, as certain institutions can be a bit stern with the process. Next, you must check and confirm the interest rate with the concerned lender. Finally, you must talk to a representative about the amount and see if the same can be arranged or not.

Ways to Secure a Business Loan in Quicktime

Here are some of the best tried and tested strategies for acquiring a credit line for business:

Standard Bank Loans

Bank loans are quite basic and are offered if standard requirements pertaining to documentation and credit profile are met. While banks often provide a decent enough credit line, the process is probably the slowest and needs every business document to be arranged and collated to perfection. However, banks offer a wide range of choices apart from personal loans and that too with different interest rates.


Better termed as the ‘Credit Guarantee Fund Government Business Loan’, this option is quite useful and lets you borrow up to Rs. 1 Crore. Plus, you need not arrange any collateral for the same. However, not every individual or firm is eligible to get a credit line as per the CGTMSE scheme, as only registered business owners with technical and entrepreneurial skills fit in this category. Interest rates for these loans can be anywhere between 6 percent to 11 percent.

Unsecured NBFC Loans

A handful of ‘Non-Banking Financial Companies’ offer unsecured business loans to individuals with decent credit profiles. NBFCs are way more lenient as compared to banks, in terms of documentation. Plus, the disbursement is usually way quicker with the lowest time frame being 3 days.

NSIC Loans

Loans provided under the canopy of NSIC (National Credit Support Scheme) specifically target MSMEs, especially the ones dealing in raw material procurement and marketing operations. Also, a handful of firms can apply for MSME loan under the ‘Marketing Support Scheme’, which is yet another scheme covered under the NSIC Loans.

Stand-Up India

For enterprises managed and run by Scheduled Castes, STs, and women, loans can be secured under the Stand-Up India scheme. Loan capital ranges between Rs. 10 lakhs and Rs. 1 Crore, or factors in 75 percent of the entire project value, whichever is lower.

PMMY Loans

As per this scheme, MSMEs can acquire Rs. 10 Lakhs as the maximum loan amount, for managing micro setups, non-farm units, and non-corporate businesses.

Wrapping Up

While these are some of the best strategies to get your hands on instant business funding, you should read the eligibility criteria and other factors before proceeding with the loan application. Or, if you are still confused you can visit some credible service providers to look at a better set of choices.