MSME loans are mostly offered to new business and small business owners. The MSME loan’s repayment tenure varies from lender to lender and the interest rates offered are majorly based on the loan amount, applicant’s profile and business history. MSME loans are also offered to new business by government with the help of various schemes. Government Schemes that come under MSME loans for new business include Mudra Loan, CGTMSE etc. These schemes ensure that the new and existing entrepreneurs in the country get the necessary financial support and funding for their businesses.
CGTMSE (Credit Guarantee Funds Trust for Micro and Small Enterprises) was introduced to establish credit relief to the promoters and provide them with a better credit flow for the MSME sector. The main benefit of CGTMSE scheme is that the MSME loan for new business is backed without any external collateral or third party guarantee. Moreover under this scheme, both new and existing MSME, including service enterprises are eligible for a maximum credit of Rs. 2 Cr.
The above Schemes are designed in such a way that any person from any part of India can avail the benefit of MSME loan. This is done to promote new business which can lead to overall economic growth of a country. MSME loan for new business in India is a major step towards employment generation which can make a country self-dependent.
