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  • Government Loans for Small Scale Businesses is Rated as "Great!" by 93411 Users

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    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

    • Bank Bazaar Personal Loan
      "Best Service"
      0.5 5.0/5 "Blown Away!"
      Bankbazaar provides best services when compared to others in the market. I am using the services of bankbazaar from more than 1 year. The website of bankbazaar is easy to use and is user friendly. Customer service was good and they followed up on time.
      Was this review helpful? 1
      , bangalore
      Reviewed on Aug 17, 2018
    • HDFC Bank Personal Loan
      "Good service"
      0.5 4.5/5 "Excellent!"
      It was a good experience with HDFC bank for personal loan, the loan amount was for Rs 4 lakhs with nominal interest rate in the market. The process was smooth and it took 10 days to receive the loan amount. Customer service was good and they followed up on time. The tenure period for this loan is 2 years.
      Was this review helpful? 1
      , bangalore
      Reviewed on Aug 17, 2018
    • Bank Bazaar Personal Loan
      "Good service"
      0.5 4.0/5 "Great!"
      I know bankbazaar.com from last 2 years but i have used bankbazaar for the first time. The services provided by bankbazaar is good when compared to others. Customer service was good with bankbazaar and their response was on time. The website of bankbazaar is easy to use and is user friendly.
      Was this review helpful? 0
      , mumbai
      Reviewed on Aug 17, 2018
    • Standard Chartered Bank Personal Loan
      "Good service"
      0.5 3.5/5 "Pretty good"
      It was an average experience with Standard Chartered Bank for personal loan, the process was quite long and it took 20-25 days to complete. Documents were collected on time and the customer service was good. The loan amount was for Rs 6 lakhs for 5 years with high interest rate.
      Was this review helpful? 1
      , mumbai
      Reviewed on Aug 17, 2018
    • Bank Bazaar Personal Loan
      "Best Service"
      0.5 5.0/5 "Blown Away!"
      Bankbazaar provides best services when compared to others in the market. I am using the services of bankbazaar from last 1 year. Customer service was very good and they responded on time. The website of bankbazaar is easy to use and is user friendly.
      Was this review helpful? 1
      , chennai
      Reviewed on Aug 17, 2018
    • Tata capital Personal Loan
      "Best Service"
      0.5 5.0/5 "Blown Away!"
      I have my personal loan application approved with TATA CAPITAL and the experience was good, the loan amount was for Rs 2 lakhs with the tenure period of 3 years and the rate of interest is nominal when compared to other banks. Customer service was good and they responded on time.
      Was this review helpful? 2
      , chennai
      Reviewed on Aug 17, 2018
    • Bank Bazaar Personal Loan
      "Best Service"
      0.5 5.0/5 "Blown Away!"
      I know bankbazaar.com from last 3-4years, the services provided by bankbazaar is good when compared to others. Customer service was good with bankbazaar and they responded on time. Mobile application of bankbazaar is easy to access and is user friendly.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Aug 17, 2018
    • HDFC Bank Personal Loan
      "Best Service"
      0.5 5.0/5 "Blown Away!"
      I have my personal loan application approved with HDFC bank and the experience was good, the loan amount was for Rs 3 lakhs with the tenure period of 4 years and the rate of interest is nominal when compared to other banks. Customer service was good and they responded on time.
      Was this review helpful? 1
      , hyderabad
      Reviewed on Aug 17, 2018
    • Bank Bazaar Personal Loan
      "Best Service"
      0.5 5.0/5 "Blown Away!"
      I am using the services of paytm from last 1 year, the services provided by bankbazaar is good when compared to others. Customer service was good with bankbazaar and their response was on time. I check my credit score on the website of bankbazaar.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Aug 17, 2018
    • ICICI Bank Personal Loan
      "Good service"
      0.5 4.0/5 "Great!"
      My experience was very good with ICICI bank for personal loan,, the process took more than 15 days to complete. The loan amount was for Rs 1 lac with nominal interest rate. Customer service was good and they followed up on time. The tenure period for this loan is 3 years.
      Was this review helpful? 1
      , hyderabad
      Reviewed on Aug 17, 2018
    • Bank Bazaar Personal Loan
      "Good service"
      0.5 3.5/5 "Pretty good"
      It was a good experience with bankbazaar so far, they provide good services when compared to others in the market. Customer service was good with bankbazaar and they responded on time. The website of bankbazaar is easy to navigate and is user friendly.
      Was this review helpful? 0
      , kolkata
      Reviewed on Aug 17, 2018
    • Kotak Personal Loan
      "Good service"
      0.5 3.5/5 "Pretty good"
      It was a good experience with Kotak Mahindra bank for personal loan, the loan amount was for Rs 3 lakhs with nominal interest rate in the market. The process was quite long and it took 15 days to receive the loan amount. Customer service was good and they followed up on time.
      Was this review helpful? 0
      , kolkata
      Reviewed on Aug 17, 2018
    • Axis Bank Personal Loan
      "Good service"
      0.5 4.0/5 "Great!"
      I have taken a personal loan with AXIS bank and my loan experience was good, the loan amount was for Rs 4 lakhs with nominal interest rate when compared to other banks. The tenure period for this loan is 4 years and there are no preclosure charges.
      Was this review helpful? 1
      , bangalore
      Reviewed on Aug 17, 2018
    • Bank Bazaar Personal Loan
      "Good service"
      0.5 4.0/5 "Great!"
      This was my first time experience with bankbazaar and it was good, the services provided by bankbazaar is good when compared to others in the market. Customer service was good and they responded on time. I check my credit score on the website of bankbazaar.
      Was this review helpful? 0
      , bangalore
      Reviewed on Aug 17, 2018
    • HDFC Bank Personal Loan
      "Need to follow up on time"
      0.5 3.5/5 "Pretty good"
      It was a fine experience with HDFC bank for personal loan, the rate of interest of 11.29% was nominal when compared to other banks. Customer service was average and the follow up was not that great. The process was quick and i received my loan amount on time.
      Was this review helpful? 0
      , bangalore
      Reviewed on Aug 17, 2018
    • Bank Bazaar Personal Loan
      "Best Service"
      0.5 5.0/5 "Blown Away!"
      I know bankbazaar.com from last 2-4 years, the services provided by bankbazaar is good when compared to other banking websites. Customer service was good with bankbazaar and they responded on time. I check for offers on the website of bankbazaar.
      Was this review helpful? 0
      , ghaziabad
      Reviewed on Aug 17, 2018
    • Cashe Personal Loan
      "Best Service"
      0.5 5.0/5 "Blown Away!"
      It was a good experience with CashE for personal loan, the process was quick and i received the loan amount immediately after the documents were approved. Customer service was good and they responded on time. The rate of interest and charges are nominal when compared to others.
      Was this review helpful? 1
      , ghaziabad
      Reviewed on Aug 17, 2018
    • HDFC Bank Personal Loan
      "Good service"
      0.5 4.0/5 "Great!"
      I have taken a personal loan with HDFC bank and the loan experience was good. The loan amount was for Rs 1.25 lakhs with nominal interest rate with the tenure period of 3 years. There are no preclosure charges and the customer service was very good with HDFC bank.
      Was this review helpful? 0
      , bangalore
      Reviewed on Aug 17, 2018
    • Bank Bazaar Personal Loan
      "Best Service"
      0.5 5.0/5 "Blown Away!"
      My experience was good so far with bankbazaar, i am using the services of bankbazaar from last 6 months. Customer service was good with bankbazaar and they responded on time. The mobile application of bankbazaar is easy to use and is user friendly.
      Was this review helpful? 1
      , bangalore
      Reviewed on Aug 17, 2018
    • Early Salary Personal Loan
      "Best Service"
      0.5 5.0/5 "Blown Away!"
      It was a good experience with Early salary for personal loan, i have taken the loan for Rs 10000 for the tenure period of 20 days. The rate of interest and charges were nominal when compared to others. Customer service was good and they responded on time.
      Was this review helpful? 0
      , bangalore
      Reviewed on Aug 17, 2018
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