Undertakings who are into manufacturing activity like retail trade, educational institutions, self-help groups and training institutions. Further, businesses which are in the service sector are also eligible to avail of funding under this loan scheme.
National Small Industries Corporation Subsidy
The NSIC is a Government enterprise under the MSMEs, and it is ISO certified. One of its primary functions is to aid the growth of MSMEs by providing services including finance, technology, market and other services across the country. The NSIC has initiated two schemes in order to promote the growth of MSMEs, which are:
- Marketing Support Scheme The scheme supports in development any business by devising schemes such as Consortia and Tender Marketing. Such a scheme is crucial as the MSMEs must be aided in order for them to grow in the current competitive market.
- Credit Support Scheme The NSIC provides for financial aid to procure raw materials, for activities in relation to marketing and for financing with banks through syndication to MSMEs.
The benefit of this scheme is that it offers the small-scale industries access to tenders without them having to bear any costs, and the MSMEs also do not have to pay the security deposits for availing financial aid under this scheme.
This scheme allows small businesses to upgrade their process by financing technological upgradation. Technological upgradation can be related to numerous processes within the organization, such as manufacturing, marketing, supply chain, etc. Through the CLCSS scheme, the government aims to reduce the cost of production of goods and services for small and medium enterprises, thus allowing them to remain price competitive in local and international markets. The scheme is run by the Ministry of Small-Scale Industries. The CLCSS offers an up-front capital subsidy of 15% for eligible businesses. However, there is a cap to the maximum amount that can be availed as a subsidy under the scheme, which is set at ? 15 lakhs. Sole proprietorships, partnership firms, co-operative, private and public limited companies come under the ambit of this business loan scheme.
Udyogini, meaning women empowerment, is a scheme that has been initiated for empowering Indian women. The scheme has been introduced under the Government of India by the Women Development Corporation. The funding under this scheme is granted in order to support women in meeting their capital requirements for starting a business.
The maximum loan that can be granted under this scheme is Rs. 15,00,000. For a woman entrepreneur to be eligible to apply for this scheme, the woman must be between the age of 18 years to 55years and the annual income of the family of the woman must not be above Rs. 15,00,000.
There is no limit of income for women who are physically challenged or widowed. There is no processing fee or collateral that is required for availing loan under this scheme.
Women who apply for this loan will have to provide passport-sized photographs, birth certificate, Below Poverty Line Card, Aadhar Card, Caste Certificate, passbook or bank account, ration card and certification of income to avail of the loan. There are about 88 categories of businesses that are mentioned for which loans can be availed by eligible women.
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While all these schemes display the commitment of the past and present Indian governments to develop the nation’s economy, there is much that needs to be done to make the schemes effective. For example, the refinancing and subsidy model used by the government takes away the quick’ factor from unsecured business loans touted by the schemes.