What are the Financing Facilities for Small Business persons in Chennai?

Chennai boasts of major industries such as tourism, software, manufacturing, hardware, medical tourism etc. It is known as the “Detroit of the India” since it has one of the largest automobile sectors.

Being a port city, it also facilitates exports and imports to and from other countries. Apart from these major industries, Chennai also has a thriving SME sector.

Several factors such as high literacy rate, low cost of living and special economic zones (SEZ) are responsible for more and more individuals setting up their business in this city.

Moreover, entrepreneurs and business owners can choose from an array of financing facilities such as business loans in Chennai to avail the required capital.

Some of these financing facilities that individuals can consider are –

Government schemes

  • MUDRA loans – Micro and small enterprises can access funding up to Rs.10 lakh under Pradhan Mantri MUDRA Yojana or PMMY. Borrowers can apply to any of the designated government or commercial financial institutions, NBFCs, etc.  to avail credit under this scheme.

This scheme offers three products that represent three different levels of funding need for an enterprise. These are –

  1. Shishu – covers loans under Rs.50,000.
  2. Kishore – includes loans from Rs.50,000 – 5 lakh.
  3. Tarun – covers loans above R.5 lakh up till Rs.10 lakh.
  • Standup India – This scheme is managed by the Department of Financial Services, of the Ministry of Finance to encourage and promote women and members from Schedule Cast and Schedule Tribe to start their own business in manufacturing, service or trading sectors.

Accordingly, under this scheme, each financial institution branch is required to provide loans up to Rs.1 crore to at least one female entrepreneur and one member from SC or ST.

Some of the other eligibility requirements that should be fulfilled to apply for loans under this scheme are –

  1. A borrower can only avail credit if it is his or her first business venture in any sector.
  2. Borrowers should not have defaulted on any payments to a financial institution.
  3. If it is a group undertaking, then 51% of the shareholding and controlling stake should be retained by a woman or SC/ST entrepreneur.
  • Credit Linked Capital Subsidy for Technology Upgradation – Under this scheme, small and medium businesses will be provided subsidy on credit for up-gradation and implementation of technology. An individual can avail 15% subsidy on a business loan of up to Rs.1 crore. Newly launched micro and small enterprises can also take advantage of this facility.

To receive a grant on loans, one can apply to anyone of the affiliated lending institutions. With these loans, entrepreneurs can upgrade their technology and use it to increase business efficiency.

  • PSB Loans in 59 minutes – As the name suggests, under this scheme, individuals can avail quick business loans in Chennai within 59 minutes. This scheme was introduced so that small business owners can apply and get approved for credit quickly by providing minimal documentation. Business owners can avail loans from Rs.1 lakh to Rs.5 crore, provided they meet all the eligibility conditions.

Business loans from financial institutions

Apart from these schemes, one can also opt for business loans in Chennai from NBFCs, which have easy to meet eligibility criteria and nominal documentation.

These are unsecured loans, so no personal or business assets need to be mortgaged. One should know all the commonly asked questions around business loans before applying for one.

Lenders like Bajaj Finserv also provide pre-approved offers for a hassle-free credit application process, which also saves time. These offers can be availed on personal loans, business loans, and a host of other financial products. Individuals can check their pre-approved offers by providing their name and contact information.

One can also opt for a loan that fits their financing needs such as working capital loans, machinery loans, SME and MSME loans, business loans for women. With a business loan, individuals can avail substantial funding at affordable interest rates.

It will enable them to purchase new technology, update and maintain inventory, renovate business infrastructure and to increase their working capital.