11 Government Loan Schemes: Loans up to ₹10 crore available for everyone from street vendors to women, farmers, and small business owners.
Recently, Finance Minister Sitharaman informed Parliament that the government has made significant efforts to facilitate easy access to loans for small traders, farmers, and women across the country. The government stated that various digital and administrative reforms have been implemented to make the loan process simpler, transparent, and time-bound. Eligible beneficiaries are being provided loans quickly through platforms such as the Jan Samarth Portal, 'PSB Loans in 59 Minutes', Udyamimitra Portal, and PM SVANidhi Portal. The government's primary objective is to extend credit to people without the burden of lengthy paperwork.
The government is running 11 loan schemes for citizens, small traders, women, and farmers. These schemes provide provisions for loans ranging from ₹10,000 to ₹10 crore for various purposes.
**PMMY Scheme**
Under the Pradhan Mantri Mudra Yojana (PMMY), collateral-free loans are provided to small and micro-entrepreneurs. The scheme offers loans across three categories: 'Shishu' loans (up to ₹50,000), 'Kishor' loans (up to ₹5 lakh), and 'Tarun Plus' loans (up to ₹20 lakh).
**Prime Minister's Employment Generation Programme (PMEGP)**
The Prime Minister's Employment Generation Programme (PMEGP) offers loan subsidies for starting new industries. It provides a subsidy ranging from 15% to 35% on loans of up to ₹50 lakh for the manufacturing sector and up to ₹20 lakh for the service sector.
**CGTMSE Scheme**
This scheme enables micro and small enterprises to secure substantial loans of up to ₹10 crore without providing collateral. Under this scheme, the government provides a loan guarantee to banks. CGTMSE does not lend directly to businesses; instead, it provides guarantees to participating lenders. If a borrower defaults on the loan, the lender can recover a specified portion of the outstanding amount from the trust, in accordance with the scheme's terms.
**SIDBI Make in India Loan (SMILE)**
The SIDBI Make in India Loan (SMILE) scheme aims to promote the 'Make in India' initiative. It provides 'soft loans' at low interest rates to strengthen the financial structure of MSMEs. Under this scheme, loans of at least ₹10 lakh for equipment and ₹25 lakh for other requirements are provided. A repayment period of up to 10 years is allowed, including a 3-year moratorium.
PSB Loans in 59 Minutes
This is a business loan that offers quick online approval. Loans ranging from ₹1 lakh to ₹5 crore can be sanctioned in just 59 minutes. However, the business must be IT-compliant and GST-registered. An interest rate of 8.5 percent is charged on these loans.
Stand-Up India Scheme
Under the Stand-Up India scheme, every bank branch provides loans ranging from ₹10 lakh to ₹1 crore to at least one woman entrepreneur and one SC/ST entrepreneur to start a new business.
Udyogini Scheme
The Udyogini scheme is implemented across various states through Women Development Corporations and select government banks. Under this scheme, loans of up to ₹3 lakh are provided to make women entrepreneurs self-reliant. Eligible women also receive an interest subsidy. The objective of the Udyogini scheme is to assist women entrepreneurs engaged in small-scale trade and service businesses.
PM SVANidhi
Under the PM SVANidhi scheme, street vendors receive working capital loans. They can access an initial loan of ₹10,000; upon repayment, they become eligible for a loan of ₹20,000, followed by a loan of up to ₹50,000. An interest subsidy of 7 percent is also provided.
PM Vishwakarma Scheme
Under the PM Vishwakarma scheme, traditional artisans are provided with skill training and loans of up to ₹3 lakh. These loans are collateral-free. Traditional artisans covered under the scheme include blacksmiths, goldsmiths, potters, and tailors. The loan is disbursed in two installments: ₹1 lakh initially, followed by ₹2 lakh.
Kisan Credit Card
The Kisan Credit Card (KCC) scheme is designed for farmers. Under this scheme, farmers are provided with easy loans at low interest rates for farming activities, fertilizers, seeds, and animal husbandry. Farmers can avail of these loans at any time. Furthermore, a 3% interest subsidy is granted for timely repayment; while the nominal interest rate is 7%, the effective rate becomes 4% after the 3% subsidy is applied.
NABARD Rural Credit Scheme
The NABARD Rural Credit Scheme supports the promotion of agribusinesses and small-scale cottage industries in rural areas. NABARD does not lend directly to the general public or farmers; instead, it acts as an apex banking institution that provides refinancing to rural banks, cooperative banks, and commercial banks, as well as subsidies under government schemes.
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