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MSME / SME Loan
Micro, Small, and Medium Enterprises (MSME), also referred to as small and medium enterprises (SME), are businesses considered to be the backbone of our economy. They not only provide employment to millions of people around the country but also generate revenue for the governments by paying their taxes. Banks and Non-banking financial companies (NBFCs) in India offer a variety of financial products such as MSME / SME Loans to meet the needs of these businesses.
With competitive rates, a simple loan application process, and quick disbursal of the loan amount, MSME / SME Loans are one of the best choices available for entrepreneurs to meet the financial needs of their business.
Currently, Moneyview does not provide MSME / SME loans. We only provide personal loans up to Rs 5 lakhs to salaried and self-employed applicants. You can also take a personal loan to meet the financial needs of your business.
The loan amount borrowed under this scheme can be used by small and medium enterprises for the following purposes:
Easy Application Process
Most lenders offer a simple loan application process and the loan requests are processed and approved without any hassles.
Quick Loan Disbursal
Lenders understand the importance of acquiring funds for the functioning of a business and hence offer fast disbursal of the loan amount.
Competitive Rates –
Due to the presence of many lenders offering SME loans in the country, the interest rates offered by them are quite competitive.
Flexible loan tenures
This loan offers customers the flexibility to select a repayment plan that not only suits their requirements and circumstances, but also their repayment capacity.
No Collateral and Third-Party Guarantee Requirement
There is no collateral or guarantee requirement for unsecured business loans for small and business enterprises.
The eligibility criteria followed by most lenders for SME loans are as follows:
The rate of interest offered with MSME / SME loans is usually based on several factors such as credit history, loan amount, repayment tenure, etc.
Given below is a list of some of the top MSME / SME loans providers in India and the interest rates offered by them.
| Bank | Minimum Interest Rate Per Annum |
|---|---|
| SBI (Mudra Loan) | 9.75% |
| Bank of India | 10.20% |
| Bajaj Finserv | 18% |
| HDFC Bank | 13% |
| ICICI Bank | 13% |
| Corporation Bank | 10.30% |
| Punjab National Bank (Mudra Loan) | 10.30% |
| HDB Finance | 18% |
| Axis Bank | 15.50% |
| IDFC First Bank | 18% |
| Lendingkart Finance | 18% |
| Kotak Mahindra Bank | 16% |
| Flexiloans | 18% |
| RBL Bank | 18% |
| SMFG India Credit | 17% |
| Processing Fee | Starting from zero to 4 percent of the approved loan amount |
| Part or pre-payment Charges | Starting of zero to 4 percent of the pending loan amount |
| Loan Cancellation Charges | Differs from one lender to another |
| Foreclosure Charges | Starting of zero to 5 percent of the pending loan amount |
**Please note that the interest rates, fees, and other charges mentioned above may not be up to date and will differ from one lender to the other. Please contact the lender directly to know about the applicable interest rates, eligibility criteria, and fees & charges.
The documents required to avail MSME / SME loans may differ from one lender to the other.
There is no such thing as free lunch. The same logic works for the loan moratoriums too.
Let's check out their main disadvantages so that you do not falter while availing a loan moratorium in the future.
To begin with, the moratorium is not a waiver. The EMIs will have to be paid subsequently. Considering that unpaid EMIs will be added to the principal, you will end up paying a higher EMI for the remainder of your loan term.
This will place additional stress on you. So, while you may be relaxed during the moratorium period, you will eventually have to deal with the payback amount.
When dealing with long-term loans, such as home loans, the loan's duration may lengthen. As a result, if you use the loan moratorium option, you may have to pay a higher overall interest amount during the loan time.
Choosing a moratorium will have tax consequences. If you select a moratorium, the tax break you get on interest payments will be reduced.
Deferring at least two EMIs might result in a 6- to 10-month extension of your loan.
Compared to the current interest rate, the loan's interest payments will be more significant when the moratorium is officially over.
Before opting for loan moratoriums, you should know a few points. These are:
Keep in mind that the terms and circumstances of your home loan's moratorium period may differ between financial lenders.
To prevent misunderstanding and make the best decision, search for lenders who give a suitable break during the first years of the loan term.
Remember to carefully examine your loan interest rates since many lenders may raise the interest rate once the vacation season is over to compensate for the break.
This is particularly common with house loans with adjustable interest rates. Using the EMI calculator of Moneyview, you can determine how your EMIs will be affected.
Once you've chosen a lender, talk to them about your demands and clarify any additional charges and processes ahead of time. This guarantees that you can obtain simple repayment conditions for the entire period, even after the EMI break.
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Disclaimer
The starting interest rate depends on factors such as credit history, financial obligations, specific lender's criteria and Terms and conditions. Moneyview is a digital lending platform; all loans are evaluated and disbursed by our lending partners, who are registered as Non-Banking Financial Companies or Banks with the Reserve Bank of India.
This article is for informational purposes only and does not constitute financial or legal advice. Always consult with your financial advisor for specific guidance.
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