MSME Loan Schemes
MSMEs (Micro, Small and Medium Enterprises) require funds for their growth, and the government of India has time and again come up with various loan schemes that would, in a way, boost the setup and mechanisms of these startups and provide them with the push that they need to support them economically. MSMEs benefit and expand their establishment through these loan schemes. Let’s discuss some of the loan schemes launched by the government of India in 2025.
• Pradhan Mantri Mudra Yojana
The government offered the first loan scheme in 2015, focusing on providing loans to MSME startups and businesses. The loan's value is as high as Rs. 10 Lakh to non-corporate, non-farm farm small and micro enterprises. These are MUDRA ( Micro Units Development and Refinance Agency Limited) loans.MUDRA is a nonbanking financial company that supports MSME growth and expansion by refinancing banks and providing MSMEs with loans provided to the business through commercial banks, small finance banks, etc. Loans are provided after looking at the growth trajectory and standing of the companies.
• Prime Minister's employment generation programme
The second loan scheme that the government of India has launched combines the Prime Minister Rozgar Yojana and the Rural Employment Generation Programme. The primary focus of this loan scheme is to create employment opportunities for unemployed youth and traditional artisans. This scheme considers self-help groups and institutions registered under the Societies Registration Act eligible. The maximum cost of the project in the manufacturing sector is 25 Lakhs, and for the business sector it is 10 Lakhs.
• Credit Guarantee trust fund for Micro and small enterprises
The third loan scheme is the micro and small enterprises' credit guarantee trust fund. Its primary focus is to ensure a credit guarantee for the MSMEs and businesses without collateral. Both existing and new startups are eligible to apply for this scheme.
• Credit-Linked Capital Subsidy Scheme
The following loan scheme is called the credit linked capital subsidy scheme which provides a 15% subsidy on additional investments of upto Rs. 1 Crore for MSMEs upgrading to the state- of- art technology. Any MSME startup or business is eligible for this loan scheme. But the MSMEs or startups that are replacing the existing technology with the same technology will not qualify for this MSME loan scheme. All the eligible businesses can approach one of the 12 nodal banks, including NABARD, SBI, PNB, Andhra Bank, and Canara Bank, among other corporate banking setups.
• Credit guarantee scheme for subordinate debt
The following loan scheme for MSMEs and businesses is the credit guarantee scheme for the Subordinate EBt. This loan scheme primarily seeks to extend financial and monetary support to the promoters of the operational MSMEs. The promoters of these businesses will infuse this amount as equity, thereby increasing the liquidity and maintaining the debt-equity ratio. The loan scheme provides a 90% guarantee for sub-debt, and the remaining 10% will be from the concerned promoters. MSMEs are subject to a moratorium of 7 years on the payment of the principal.
• MSME Business loan for startups in 59 minutes
The following loan scheme is available from a web portal launched to provide MSMEs with loans in 59 minutes. The processing of loan-related documents in this scheme is done in a fully automated manner. After the portal approves the loan scheme for the business, the loan is disbursed to the applicant within eight working days. Any MSME wishing to apply for a business loan can apply for this scheme. The business approvals are made from 1 lakh to 5 crore, and the loans can be availed with or without collateral.
Those mentioned above were some of the loan schemes effective in 2025 for MSMEs and businesses that operate on a medium or small scale.
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MSME Loan Schemes Pradhan Mantri Mudra Yojana
• Prime Minister’s employment generation programme
• Credit Guarantee trust fund for Micro and small enterprises
• Credit-Linked Capital Subsidy Scheme
• Credit guarantee scheme for subordinate debt
• MSME Business loan for startups in 59 minutes
