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Government Loan Schemes For Small Scale Businesses

Author: Neeraj Tehlan
by Neeraj Tehlan
Posted: Jun 17, 2017
micro small

THE CREDIT GUARANTEE FUND SCHEME FOR MICRO AND SMALL ENTERPRISES

  • It is launched by the Government of India to provide collateral free finance to the micro and small enterprise sector.
  • The Amount is contributed by Government and SIDBI is 4:1 in ratio.
  • It also provides credit facilities in the form of term loans and working capital facility of up to Rs.100lakh per borrowing unit.
  • Rehabilitation assistance is also made available to sick units.

CREDIT LINK CAPITAL SUBSIDY SCHEME FOR TECHNOLOGY UPGRADATION

  • Its main intention is to create an impact in the international trade.
  • It is launched to facilitate technology up gradations by extending an upfront capital subsidy of 15% (max INR 15lakhs).
  • The corresponding plant and machinery is important
  • It is available to machinery to Sole Proprietorship, Partnership firms, Cooperative, Private and Public Limited Companies.

SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA

  • SIDBI is one of the most illustrious names among the government financial institutions.
  • It played an active role in the promotion and development of the small business industry.

Schemes provided by SIDBI

  • Direct Assistance Scheme
  • Indirect Assistance Scheme
  • Promotional and Development Activities
  • National Equity Fund, scheme
  • Technology Development and Modernization Fund scheme
  • Single window scheme
  • Mahila Udyami Nidhi (MUN)
  • Scheme and Equipment Finance Scheme

NATIONAL SMALL INDUSTRIES CORPORATION LIMITED (NSIC)

  • The main feature is to import machines on hire-purchase terms.
  • It promotes awareness about advancements in the small scale industries sector of the country.
  • It highlight on supply and distribution of both indigenous and imported raw materials as well as exporting the products of the small business units.

NATIONAL BANK FOR AGRICULTURE AND RURAL DEVELOPMENT

  • NABARD mainly came into existence to promote agriculture based rural business enterprises.
  • It mostly offers financial assistance to small scale industries viz,. Cottage and village industry.

MARKET DEVELOPMENT ASSISTANCE SCHEME FOR MSMEs

  • It offers funding for participation in international trade fairs and exhibitions under MSME India stall.
  • It also offers financing for sector specific market studies by industry association, export promotion councils and FIEO.
  • This scheme offers reimbursement of 75% of a one-time registration fee and 75% of annual fees paid to GSI by SMEs for the first 3 years for the bar code.

TECHNOLOGY AND QUALITY UPGRADATION SUPPORT TO MSMEs

  • It aims to improve the production quality of MSMEs to encourage them to adopt global manufacturing standards.
  • The main aim of this scheme is to sensitize the manufacturing MSME sector to make use of energy sufficient technologies
  • And also the manufacturing processes to reduce manufacturing cost and emissions of harmful gasses that can hamper the environment
  • The Indian government provides financial support to the extent of 75% of the actual expenditure to assist manufacturing sector purchase energy efficient technologies for production.

MINI TOOLS ROOM AND TRAINING CENTRE SCHEME

  • The mission of this scheme is to develop more tool room facilities to provide technological support to the MSMEs
  • The training in tool manufacturing and tool design to create a skilled workforce of workers, supervisors, engineers/designers.
  • 90% of the cost of machinery/equipment in case a new Mini tool room is to be created.
  • In case an existing room to be upgraded – 75% of the cost is funded.

MUDRA LOAN (Micro Units Development and Refinance Agency Ltd.)

  • The vision of Funding the Unfunded.
  • It is established by Government of India for development and refinancing activities relating to micro units.
  • It provides low cost funding for MFI (Micro Finance Institutes)
  • It also supporting to the institutions, societies, trusts section 8 companies, co-operative societies, small Banks, Scheduled commercial Banks and Rural Banks which are in the business of lending to micro or small business etc.

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Author: Neeraj Tehlan

Neeraj Tehlan

Member since: Oct 20, 2014
Published articles: 31

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