VARIOUS SMALL BUSINESS LOAN SCHEMES

IN INDIA

INTRODUCTION
Running a business is never an easy task. One is
bound to face financial hiccups during the
process. Whether you are a new generation
entrepreneur venturing into a new business or an
established businessman planning for a business
expansion. y Banks are more conservative with
their investment dollars. Unlike many venture
capitalists or angel investors, they are far
more likely to approve a loan for an established
business over a startup or emerging company.
This is largely due to the fact that they are
investing the money of their depositors.

Scheme for Development of Industrial

Infrastructure for SSI Sector (DII)
Setting up of industrial estates / development
of industrial areas including such projects
found eligible under KVIC model. Strengthening
of existing industrial clusters / estates by
providing increased amenities for smooth working
of the industrial units. Setting up of
warehousing facilities for SSI products / units.
y Providing support services viz., common
utility centre's such as convention halls, trade
centre's, raw material depots, warehousing, tool
rooms / testing centre's, housing for industrial
workers, etc. Any other infrastructural
facilities which will benefit predominantly SSI
units / entrepreneurs.

Schemes available with SIDBI.

.Single Window Scheme to provide both term loan
for fixed asset and loan for working capital
through the same agency. It is applicable to
projects with cost upto Rs. 50 lakhs. The Scheme
is operated both by banks and financial
institutions. Technology Development &
Modernization Fund Scheme for providing finance
to existing SSI units for technology up
gradation/ modernization. National Equity Fund
Scheme which provides equity support to small
entrepreneurs setting up projects in Tiny
Sector. Composite Loan Scheme for equipment
and/or working capital and also for work sheds
to artisans, village and cottage industries in
Tiny Sector. Mahila Udyam Nidhi (MUN) Scheme
provides equity support to women entrepreneurs
for setting up projects in Tiny Sector.

.Equipment Finance Scheme for acquisition of

machinery/equipment including Diesel Generator
Sets which are not related to any specific
project. Venture Capital Scheme to encourage
SSI ventures/subcontracting units to acquire
capital equipment, as also requisite technology
for building up of export capabilities/import
substitution including cost of total quality
management and acquisition of ISO-9000
certification and for expansion of capacity.
ISO 9000 Scheme to meet the expenses on
consultancy, documentation, audit, certification
fee, equipment and calibrating instruments
required for obtaining ISO 9000 certification.

. Micro Credit Scheme to meet the requirement of

well managed Voluntary Agencies that are in
existence for at least 5 years; have a good
track record and have established network and
experience in small savings-cum-credit
programmes with Self Help Groups (SHGs)
individuals.
Technology Development & Modernization Fund
SIDBI has set up Technology Development &
Modernisation Fund (TDMF) scheme for direct
assistance of small sale industries to encourage
existing industrial units in the sector, to
modernise their production facilities and adopt
improved and updated technology so as to
strengthen their export capabilities.
SIDBI in July 1996 had permitted SFCs and
promotional banks to grant loans for
modernisation projects costing upto Rs. 50 lakhs

.National Equity Fund

National Equity Fund (NEF) under Small

Industries Development Bank of India (SIDBI)
provides equity type assistance to SSI units,
tiny units at one per cent service charges. The
scope of this scheme was widened in 1995-96 to
cover all areas excepting Metropolitan areas,
raising the limit of loan from Rs. 1.5 lakhs to
Rs. 2.5 lakhs and covering both existing as well
as new units.
 LOAN SCHEMES OF
VARIOUS BANKS
Central Bank of India
Name of the loan : Cent Kalyani Credit
facilities are available for Women
Entrepreneurs for the following: Small Business
: For entrepreneurs who intend to provide
service (not a professional service) such as
setting up a small lunch/canteen, mobile
restaurant, circulating library etc.
Professional and Self Employed : Entrepreneurs
who are specially qualified/skilled and
experienced like Doctors, Chartered Accountants,
Engineers or trained in Art or Craft etc.
Retail Trade : For entrepreneurs who intend to
engage in retail trading of various commodities.
Village and Cottage/Tiny Industries : For
entrepreneurs who are engaged in manufacturing,
processing, preservation and services such as
Handloom, Weaving Handicraft, Food-Processing,
Garment making etc. in village and small towns
with a population not exceeding 50,000 utilizing
locally available resources/skills.

Small Scale Industries : To start a unit engaged

in manufacture, processing or preservation of
goods.
Agriculture & Allied Activities : For women
entrepreneurs who are engaged/intend to engage
in agricultural and allied activities, such as
raising of crops, floriculture, fisheries, bee-
keeping, nursery, sericulture etc. and also
trading in agricultural inputs. y Government
Sponsored
Programmes : Apart from the above schemes, women
entrepreneurs are also financed under the
various Government Sponsored Programmes where
Capital subsidies are available