MSME Loan: Interest Rates, Eligibility & How to Apply
MSME Working Capital & Business Loan – Key Parameters
Minimum Interest Rate
Starts from approximately 8.25% p.a. under select
public sector bank-linked EBLR schemes.
Private banks and NBFCs may charge around 11%–24% p.a., depending on the lender, product and borrower profile.
Private banks and NBFCs may charge around 11%–24% p.a., depending on the lender, product and borrower profile.
Maximum Loan Amount
Eligible credit facilities may receive CGTMSE guarantee coverage up to
₹10 Crore, subject to scheme guidelines and lender approval.
DPIIT-recognized startups may qualify for guarantee coverage up to ₹20 Crore under applicable CGSS provisions. Secured MSME loans may offer higher amounts based on project requirements and lender assessment.
DPIIT-recognized startups may qualify for guarantee coverage up to ₹20 Crore under applicable CGSS provisions. Secured MSME loans may offer higher amounts based on project requirements and lender assessment.
Maximum Tenure
Term loans may offer repayment periods of up to
10 years, depending on the scheme and project.
A moratorium of approximately 6–18 months may be available for eligible projects.
Working Capital / OD facilities are generally sanctioned for 12 months, subject to annual review and renewal.
A moratorium of approximately 6–18 months may be available for eligible projects.
Working Capital / OD facilities are generally sanctioned for 12 months, subject to annual review and renewal.
Disclaimer: Interest rates, loan amounts, guarantee
coverage, tenure and eligibility are indicative and subject to lender
policies, scheme guidelines, documentation and credit assessment.
Guarantee coverage is not the same as automatic loan approval.
MSME FINANCE
Collateral-Free MSME Loan Eligibility Criteria
Eligible Micro and Small Enterprises may explore collateral-free business finance through participating lenders under applicable credit guarantee schemes.
01
Enterprise Classification
The business must meet the applicable Micro or Small Enterprise classification criteria under the MSMED Act and current government notifications.
02
Udyam Registration
A valid Udyam Registration is generally required where prescribed under the applicable scheme and lender policy. Businesses can check registration details on the official Udyam portal.
03
Business Vintage & Track Record
Existing businesses may be assessed on operating history, business stability and financial performance. New businesses may qualify under certain eligible schemes, subject to their specific conditions.
04
Credit Profile
The lender may evaluate the promoter's and business's credit history, repayment record, outstanding obligations and credit bureau information. There is no single CIBIL threshold applicable to every lender or scheme.
05
Financial Strength & Compliance
Bank statements, turnover, cash flows, financial statements, repayment capacity and applicable GST and tax compliance may be reviewed during assessment.
06
Eligible Business Activities
Eligible manufacturing, service and trading enterprises may apply, subject to the relevant scheme's permitted activities, exclusions and lender policies.
07
Scheme Exclusions
Certain activities, institutions and borrower categories may be excluded or treated differently under specific schemes. Confirm the current eligibility rules before applying.
Important:
Collateral-free finance does not mean automatic approval or
exemption from all security requirements. The lender may require
primary security over assets financed or other permitted security.
Final eligibility, credit limit, fees and terms depend on the
applicable scheme and lender's assessment.
MSME BUSINESS FINANCE
Documents Required for MSME Loan
Keep the following documents ready for your MSME working capital, business loan or machinery finance enquiry. Requirements may vary by lender, business constitution and loan scheme.
KYC & Legal Entity Proof
- Promoter KYC: PAN and applicable identity/address proof of the proprietor, partners or directors, as required by the lender.
- Business Registration: Certificate of Incorporation, Partnership Deed, LLP documents, MOA & AOA, or applicable business registration proof.
- MSME Identification: Udyam Registration Certificate, where applicable.
- PAN Details: PAN of the business entity, where applicable. Sole proprietorships generally use the proprietor's PAN.
- Additional Documents: GST registration, address proof, ownership or rental documents and other KYC documents, if required.
Financial & Operational Documents
- Bank Statements: Primary business bank statements, commonly for the previous 6–12 months, depending on lender requirements.
- Financial Statements: Balance Sheet, Profit & Loss Statement and income computation for the available financial years, as applicable.
- Income Tax Returns: Business and/or promoter ITRs with supporting schedules, where required.
- GST Returns: Filed GSTR-1 and GSTR-3B returns, where applicable.
- Tax Audit Documents: Applicable tax audit reports, such as Form 3CA/3CD, and related documents where required by law or the lender.
- Existing Loan Details: Current sanction letters, outstanding statements and repayment schedules for existing credit facilities, if applicable.
Scheme & Project Documentation
- Detailed Project Report (DPR): Project cost, proposed funding, business plan, projected financials and cash-flow estimates, where required.
- Vendor Quotations: Quotations or proforma invoices for machinery, equipment, inventory or other proposed purchases, as applicable.
- Working Capital Assessment: Stock statements, debtor/creditor details, inventory records and projected operating requirements, if requested.
- Scheme-Specific Documents: Application forms, declarations, category certificates or other documents required under the relevant government scheme.
Important Note:
This is a general checklist, not a universal mandatory document list.
New businesses, proprietorships, companies and existing MSMEs may
have different requirements. The lender may request additional
documents during verification and credit assessment.
Need Help With Your MSME Loan Application?
LoansBazaar India provides loan enquiry and application assistance for eligible business finance options from participating lenders.
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LOANSBAZAAR INDIA
Compare Business Loan Options
Explore indicative interest rates, processing fees and loan amounts from multiple lenders. Submit your enquiry to check available options.
Calculate Your EMI →IDFC
IDFC FIRST Bank
Processing Time7–10 Days
Interest Rate14% onwards
Processing FeeUp to 3%
Maximum Loan₹1 Crore
B
Bajaj Finserv
Processing Time3–6 Days
Interest Rate19% onwards
Processing FeeUp to 2%
Maximum Loan₹75 Lakh
AB
Aditya Birla Capital Limited
Processing Time1–2 Days
Interest Rate21% onwards
Processing FeeUp to 2%
Maximum Loan₹50 Lakh
T
Tata Capital
Processing Time3–6 Days
Interest Rate19% onwards
Processing FeeUp to 2%
Maximum Loan₹75 Lakh
L&T
L&T Finance
Processing Time3–6 Days
Interest Rate17% onwards
Processing FeeUp to 2%
Maximum Loan₹75 Lakh
F
FlexiLoans
Processing Time3–6 Days
Interest Rate18% onwards
Processing FeeUp to 2%
Maximum Loan₹25 Lakh
P
Protium
Processing Time5–7 Days
Interest Rate26% onwards
Processing FeeUp to 5%
Maximum Loan₹40 Lakh
K
KreditBee
Processing Time1–2 Days
Interest Rate21% onwards
Processing Fee2.25%
Maximum Loan₹50 Lakh
A
Axis Bank
Processing Time7–10 Days
Interest Rate14% onwards
Processing FeeUp to 2%
Maximum Loan₹75 Lakh
I
Indifi
Processing Time3–6 Days
Interest Rate18% onwards
Processing FeeUp to 2%
Maximum Loan₹75 Lakh
P
Poonawalla Fincorp
Processing Time1–2 Days
Interest Rate24% onwards
Processing FeeUp to 2.35%
Maximum Loan₹15 Lakh
G
Godrej Capital
Processing Time7–10 Days
Interest Rate16% onwards
Processing FeeUp to 3.93%
Maximum Loan₹75 Lakh
L
LendingKart
Processing Time7–10 Days
Interest Rate17.25% onwards
Processing FeeUp to 2%
Maximum Loan₹10 Lakh
HDB
HDB Financial Services
Processing Time7–10 Days
Interest Rate16% onwards
Processing FeeUp to 2.5%
Maximum Loan₹7.5 Lakh
H
Hero FinCorp
Processing TimeInstant*
Interest Rate17% onwards
Processing Fee2–5%
Maximum Loan₹5 Lakh
F
Federal Bank
Processing TimeInstant*
Interest Rate10.49% onwards
Processing Fee1.99–3.99%
Maximum Loan₹5 Lakh
S
Slice Small Finance Bank
Processing Time7–10 Days
Interest Rate11.1% onwards
Processing FeeUp to 2%
Maximum Loan₹3 Crore
N
NeoGrowth
Processing Time2–3 Days
Interest Rate19% onwards
Processing Fee2–3%
Maximum Loan₹75 Lakh
P
Prefr
Processing TimeInstant*
Interest Rate18% onwards
Processing Fee2–5%
Maximum Loan₹5 Lakh
U
UdhaarSaathi
Processing Time3–5 Days
Interest Rate30% onwards
Processing Fee4.5%
Maximum Loan₹2.5 Lakh
K
Kissht
Processing TimeInstant*
Interest Rate18% onwards
Processing Fee2–5%
Maximum Loan₹2 Lakh
R
Ram Fincorp
Processing TimeInstant*
Interest Rate20% onwards
Processing Fee2%
Maximum Loan₹1 Lakh
A
Apollo Finvest
Processing TimeInstant*
Interest Rate20% onwards
Processing Fee2–5%
Maximum Loan₹15,000
M
My Money Bazaar
Processing TimeInstant*
Interest Rate20% onwards
Processing Fee2–5%
Maximum Loan₹1 Lakh
T
True Balance
Processing TimeInstant*
Interest Rate18% onwards
Processing Fee2–5%
Maximum Loan₹1 Lakh
C
CreditSea
Processing TimeInstant*
Interest Rate21% onwards
Processing Fee10%
Maximum Loan₹2 Lakh
D
DigiCredit
Processing TimeInstant*
Interest Rate21% onwards
Processing Fee10%
Maximum Loan₹40,000
M
Muthoot Finance
Processing Time2–3 Days
Interest Rate11.99% onwards
Processing Fee₹250 + GST
Maximum Loan₹5 Lakh
B
Branch
Processing TimeInstant*
Interest Rate16% onwards
Processing Fee3.5%
Maximum Loan₹2 Lakh
Disclaimer: The lender details shown above are indicative and based on information provided for this comparison. Interest rates, processing fees, maximum loan amounts and processing times may change and depend on the specific product, borrower profile, eligibility, documentation and lender policies. “Instant” does not mean guaranteed disbursal or approval. LoansBazaar India provides loan enquiry and application assistance; the lender makes the final credit decision. Confirm the latest terms directly with the lender before applying.