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  • Government Loans for Small Scale Businesses is Rated as "Great!" by 92205 Users

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    rated 4.0/5.0 by 92205 users

    Government Loans for Small Scale Businesses

    Small Scale Businesses or industries need better support and financial aid in order to have proper growth and flourish well in the face of stiff competition from companies or organisation that are privately funded or have an established presence in the market.

    Financing provided by the government is preferred because of lower rates available under government schemes. Such loans also help out in managing the day-to-day funding requirements of a business. There are many public sector banks which work in tandem with various government organisations to provide loans under government-aided schemes. Some of the prominent names are State Bank of India, Andhra Bank and Bank of Baroda, among others.

    Financing Facilities available for Small Scale Businesses

    There are many different facilities as per which loans or financing options are available to small scale businesses and their entrepreneurs. Some of the more popular ones are as follows

    1. Working Capital Finance – Can be availed through direct funding or a letter of credit. This kind of financing can help aid in the operating expenses of a business and it can also help in purchasing assets related to small scale businesses
    2. Corporate Term Loans – Applied and used for starting new ventures, in the running of existing business or for expansion in any particular market
    3. Term FinanceTerm Loans are helpful in purchasing fixed assets like buildings, machinery and the like. With floating interest rates, these loans generally have a repayment period that could go up to 10 years

    Specific types of Loans available from Public Sector Banks

    The aforementioned banks have a variety of schemes under which operating finance is provided to small businesses. An overview of such schemes as per specific banks is mentioned below.

    1. State Bank of India – Probably the first destination for most small scale entrepreneurs, SBI offers loans and schemes through multiple channels to allow a holistic financial support for small scale businesses. The bank extends specialised help to agricultural businesses and has set up specific centres that are present in rural and semi-urban branches. A few of its schemes pertaining to the development of agriculture are
      1. Crop Loan
      2. Horticulture Financing
      3. Farm Mechanisation Schemes
      4. Land Development Schemes
      5. Minor Irrigation Projects
      6. Agricultural Term Loans

    Some of its funding schemes for businesses other than agriculture are as follows

    1. Working Capital Finance
    2. Corporate Term Loans
    3. Deferred Payment Guarantees
    4. Project Finance
    5. Structured Finance
    1. Bank of Baroda - This bank has a few schemes aimed at providing financial aid to small scale entrepreneurs but they have been quite effective nonetheless and are quite popular in the same sector. The schemes offered by Bank of Baroda can be listed as below-
      1. Working Capital Finance
      2. Term Finance
      3. Small and Medium Enterprise Loan Pack
      4. Small Business Borrowers
      5. Traders Loan
    2. Andhra Bank - There are a variety of schemes offered by Andhra Bank and these mainly cater to the corporate and agricultural sector. A few of the important loan schemes available for small scale businesses are -
      1. Working Capital Loans
      2. Export and Import Finance
      3. Advance against Shares
      4. Term Finance
      5. Corporate Loans
      6. Project Finance
      7. Infrastructure Project Finance
      8. Kisan Vikas Card
      9. Kisan Sampathi
      10. Self Help Groups-Bank Linkage Programme
      11. Kisan Green Card

    Loan Schemes and Facilities initiated by the Government of India

    Apart from banks which provide financial support to small business through special loan schemes, the government of India has also set up schemes and makes use of different associations in order to zero in on businesses which might require financial support. Most of the programmes initiated by the government are implemented through the following organisations

    Small Industries Development Organisation (SIDO)

    It serves to promote and helps in development of small scale industries. The major functions of this entity are as follows

    Advising the government on new schemes for small scale industriesConducting surveys on the small scale industry sector and ascertaining key growth factors

    Liaison with central ministry, planning commission, state governments, financial institutions and other organisations related to the development of small scale businessesHelping in linking small scale industries to large and medium scale industriesDevelopment of human resources through training and skill upgrades

    For the above-mentioned functions, some of the schemes put forth by SIDO are as follows

    Credit Linked Capital Subsidy Scheme for Technology Upgradation

    Credit Guarantee Scheme

    ISO 9000/ISO 14001 Certification Reimbursement Scheme

    Integrated Infrastructure Development (IID Scheme)

    SSI MDA Scheme

    Assistance to Entrepreneurship Development Institutes

    Micro Finance Programme

    National Small Industries Corporation Limited (NSIC)

    Established to provide specially tailored schemes that facilitate

    Marketing support through promotion and other contemporary means of marketingCredit support through functions like

    Equipment financing

    Raw material procurement financing

    Marketing activities financing

    Bank-syndication aided financing

    Performance and credit rating system

    Technology support which allows material testing, implementation of new techniques, energy and environment services and training facilities

    Small Industries Development Bank of India (SIDBI)

    Established in 1990, this institution is by far the most popular one when considering the growth and development of small businesses. The schemes provided by SIDBI are as follows

    Direct Assistance Scheme

    Indirect Assistance Scheme

    Promotional and Development Activities

    National Equity Fund, Scheme

    Technology Development and Modernization Fund Scheme

    Single Window Scheme

    Mahila Udyam Nidhi (MUN)

    Scheme and Equipment Finance Scheme

    National Bank for Agriculture and Rural Development (NABARD)

    It promotes mainly agro-based rural businesses. The financial aid offered by NABARD is extended mainly to cottage and village industries

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    World Association for Small and Medium Enterprises (WASME)

    It is the only non-government organisation for SMEs in India. Apart from promoting the development of small and medium businesses in the country, it also provides some subsidised schemes for the growth of rural industries

    Apart from the national schemes and organisations mentioned in here, there are also separate entities and schemes set up by many state governments whose focus is aimed at supporting and aiding industries and businesses exclusive to particular states and regions.

    Government Loans for Small Scale Businesses Reviews

    • ICICI Bank Personal Loan
      "Need to reduce charges"
      0.5 4.0/5 "Great!"
      I have taken a personal loan with ICICI bank and the experience was good, the loan amount was for Rs 2 lakhs with high interest rate of 15.5%. The process was quick and i received my loan amount on time. I paid Rs 12000 for insurance and the tenure period for this loan is 48 months.
      Was this review helpful? 0
      , coimbatore
      Reviewed on Jun 19, 2018
    • HDFC Bank Personal Loan
      "Good service"
      0.5 4.0/5 "Great!"
      It has been a very good experience with them and the process in getting the loan has been very good. The security with them had been good and i am satisfied with the loan amount which they had provided. The interest rate has been good with them and the whole process had been good. It has been almost two to three months since i have taken the loan.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Jun 19, 2018
    • Axis Bank Personal Loan
      "Excellent Service"
      0.5 5.0/5 "Blown Away!"
      It has been a good process in getting this loan and i am satisfied with the loan amount which have been provided by them, The interest rate with them had been good as well as the process has taken less time and there has not been any issues so far.
      Was this review helpful? 0
      , new delhi
      Reviewed on Jun 19, 2018
    • ICICI Bank Personal Loan
      "Excellent Service"
      0.5 5.0/5 "Blown Away!"
      It has been a very good experience with this loan and the loan amount which they had provided had been satisfactory as well. The interest rate with them has been quite good compared with the market rate. The whole process had been pretty smooth and easy where it has taken very less time in getting the loan amount.
      Was this review helpful? 0
      , new delhi
      Reviewed on Jun 19, 2018
    • Bank Bazaar Personal Loan
      "Good"
      0.5 4.0/5 "Great!"
      I have a good experience dealing with this on line tool. I received good customer service and response as when I applied for the product on their website. They have an user website where we can navigate through everything hence it was easy to choose. I am very much satisfied with their services.
      Was this review helpful? 0
      , mumbai
      Reviewed on Jun 19, 2018
    • Tata capital Personal Loan
      "Good"
      0.5 4.0/5 "Great!"
      I have taken a personal loan from Tata Capital, it was a good choice that I have made, the processing my loan amount at the earliest it was not delayed, the customer service was also good, they assisted me well. The rate of interest they have charged is also quite OK as compared to others.
      Was this review helpful? 0
      , mumbai
      Reviewed on Jun 19, 2018
    • Bank Bazaar Personal Loan
      "Good"
      0.5 4.0/5 "Great!"
      The services I received from this on line tool was good, they have many options to choose the financial product from their website, it was good and hassle free, I received good customer service who helped me and assisted me in processing my application and documents, I was quite happy with the services they have provided.
      Was this review helpful? 0
      , chennai
      Reviewed on Jun 19, 2018
    • IndusInd Bank Personal Loan
      "Good"
      0.5 4.0/5 "Great!"
      I have taken a personal loan from IndusInd bank, the services were quite good, I got good assistance in processing my loan application, but however the loan process was delayed a bit with documentation other than that there is no issue. Even the rate of interest was good enough.
      Was this review helpful? 0
      , chennai
      Reviewed on Jun 19, 2018
    • Bank Bazaar Personal Loan
      "Good"
      0.5 4.5/5 "Excellent!"
      My experience that I had with this on line portal has been good n terms of services and the processing they did. I received proper communication for the product I have chosen and it went smoothly. But my only complain is that I get repeated calls in same day for same queries, if they could do some proper management for that and improve on that aspect it would be great.
      Was this review helpful? 0
      , new delhi
      Reviewed on Jun 19, 2018
    • IndusInd Bank Personal Loan
      "Good"
      0.5 5.0/5 "Blown Away!"
      I have taken a personal loan from IndusInd bank, everything was OK, except the rate of interest they have charged which I believe is a bit high as compared to others. They have charged me around 15.5 % for loan amount of Rs. 5,00,000 for 4 years. Rest assured I received the amount on time everything was smooth I am happy.
      Was this review helpful? 0
      , new delhi
      Reviewed on Jun 19, 2018
    • Bank Bazaar Personal Loan
      "Good"
      0.5 4.5/5 "Excellent!"
      I have a good experience with this on line tool, the services I have got has been good. The good part about their services is reaching out to customer service is very easy, you don't have to go through any IVR and they are directly approachable for your quick queries. I am quite satisfied.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Jun 19, 2018
    • Tata capital Personal Loan
      "Average"
      0.5 3.5/5 "Pretty good"
      My experience of personal loan with Tata Capital has been some what OK as I received the loan amount on time and I was aware about the rate of interest they have charged, however there was no annual fees but there was an insurance fee that they have charged which I came to know in mid process I was not quite happy about that.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Jun 19, 2018
    • Standard Chartered Bank Personal Loan
      "Wonderful"
      0.5 4.0/5 "Great!"
      Rate of interest is around 11.49% for the personal loan with the Standard Chartered bank. Customer service is good too with the Standard Chartered bank. Everything is better one with them till now. All of the aspects are better one with the Standard chartered bank.
      Was this review helpful? 0
      , bangalore
      Reviewed on Jun 19, 2018
    • Bank Bazaar Personal Loan
      "Best"
      0.5 4.0/5 "Great!"
      Bankbazaar.com is good one and am using it from the February onward. I would like to say that the customer service is good one and the response is also good too. I am happy with the Bankbazaar.com till now.
      Was this review helpful? 0
      , visakhapatnam
      Reviewed on Jun 19, 2018
    • HDFC Bank Personal Loan
      "Best"
      0.5 4.0/5 "Great!"
      Interest rate is around 17.5% for the personal loan with the HDFC bank. I would like to say that the response is good one for me with them and the processing charges are on higher end like its around 7000 Rupees.
      Was this review helpful? 0
      , visakhapatnam
      Reviewed on Jun 19, 2018
    • Bank Bazaar Personal Loan
      "Wonderful"
      0.5 4.5/5 "Excellent!"
      I am using Bankbazaar.com from the last three years of time. All of the financial products, I used to get it through them. Everything is an excellent one for me with them as such. I have never faced any such issues with them till now.
      Was this review helpful? 0
      , mumbai
      Reviewed on Jun 19, 2018
    • HDFC Bank Personal Loan
      "Wonderful"
      0.5 4.0/5 "Great!"
      Rate of interest is around 11% for the personal loan with the HDFC bank. I would like to say that the processing charges are on higher end. Apart from that everything is good one with the HDFC bank for the personal loan.
      Was this review helpful? 0
      , mumbai
      Reviewed on Jun 19, 2018
    • Bank Bazaar Personal Loan
      "Good "
      0.5 4.0/5 "Great!"
      Bankbazaar.com is good one and am using it from the last two months of time. I would like to say that the customer service is good one with the Bankbazaar.com. I am really happy with the Bankbazaar.com till now.
      Was this review helpful? 0
      , bangalore
      Reviewed on Jun 19, 2018
    • ICICI Bank Personal Loan
      "Okay"
      0.5 4.0/5 "Great!"
      10.99% is the rate of interest for the personal loan with the ICICI bank. I would like to say that the response is good one with the ICICI bank. Everything is better one for me with the ICICI bank, also am really happy with them till now.
      Was this review helpful? 0
      , bangalore
      Reviewed on Jun 19, 2018
    • Bank Bazaar Personal Loan
      "Good "
      0.5 3.0/5 "Satisfactory"
      I am using Bankbazaar.com from the last one year of time. I would like to say that the customer service is good one with them and the online portal is easy to access. Everything is better one for me with the Bankbazaar.com.
      Was this review helpful? 0
      , pune
      Reviewed on Jun 19, 2018
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