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SME / MSME Loan
A loan offered to an SME or a company registered as a Small and Medium Enterprise is commonly referred to as an SME loan. On the other hand, an MSME loan is sought by a company registered under Micro, Small and Medium Enterprises. SMFG India Credit provides business loans in both these categories to businesses that are looking to expand their operations by purchasing machinery, equipment and raw material, to invest in fixed assets, or even to meet their requirements for working capital.
Based on the loan application, SMFG India Credit can provide a loan of up to Rs. 1 crore* to both SMEs and MSMEs without seeking any collateral at competitive interest rates. Our loan solutions are designed to be flexible to meet the needs of our varied client base.
Features & Benefits of SME/MSME Loan
Quick Loan Approval
Access funds on time to manage urgent business needs through a seamless online application process and minimal documentation.
High Loan Amounts
Get unsecured loan amounts of up to Rs 1 crore* to support various operational and growth requirements.
Attractive Interest Rates
Benefit from competitive interest rates that help reduce overall borrowing costs, allowing you to channel more funds toward expansion.
Unsecured Loans
Enjoy collateral-free financing without pledging personal or business assets.
Online MSME Loan Account Access
Track and manage your SME/MSME loan anytime through our service portals and mobile applications.
Short-Term Capital Management
Meet short-term business needs effectively with flexible loan tenures, better cash flow management, and improved financial stability.
Eligibility Criteria for SME/MSME Loan
You can check your SME/MSME loan eligibility online before applying. Meeting the eligibility criteria helps speed up your loan application and improves approval chances. Applicants can use a business loan eligibility calculator to estimate how much they may be able to borrow.
Standard business loan eligibility criteria for MSMEs include:
|
Eligibility Parameter |
Criteria for MSME Loan |
|
Age |
Applicant must be between 21 years at the time of application and 65 years at maturity. |
|
Eligible Entities |
Self-employed individuals, MSMEs registered as proprietorships, partnership firms, or private limited companies operating in manufacturing, trading, or services. |
|
Business Experience |
At least 3 years in the current enterprise and a minimum of 5 years of overall business experience. |
|
Income / Turnover |
Annual turnover of Rs. 10 lakhs or more and a minimum annual income (ITR) of Rs. 2 lakhs, supported by two years of consistent profits. |
|
Credit Score / CIBIL Score |
Minimum score requirement of 725. |
|
Residential Status |
Applicant must be a resident Indian citizen. |
*Please note that these are the basic MSME loan eligibility criteria. Final eligibility & terms will depend upon several factors, including SMFG India Credit’s policy at the time of the MSME loan application.
Documents Required for MSME/SME Loan
To apply for an MSME or SME loan, you need to submit a set of basic documents that help assess your loan eligibility and business stability. These MSME loan documents verify your identity, income, credit profile, and business operations.
Keeping the required business loan documents ready ensures a faster application experience and smoother loan disbursement. SMFG India Credit focuses on minimal paperwork to help you apply without unnecessary delays.
|
MSME/SME Loan Documents |
Particulars |
|
PAN Card |
PAN card of the applicant and, wherever relevant, the co-applicant. A co-applicant may submit Form 60. |
|
Identity Proof (POI) and Address Proof (POA) |
● Passport ● Driving Licence ● Aadhaar Card ● Voter Identity Card from the Election Commission of India ● MNREGA job card signed by an authorised State Government officer ● National Population Register letter containing the full name and residential address |
|
Bank Statements |
Latest bank statements for the past 6 months |
|
Income Documents (CA-certified) |
● Latest 2 years' Income Tax Returns with the computation of income ● Balance sheet & Profit and Loss account for the past two years ● GST returns for the last 12 months |
|
Proof of Business Continuity (any one) |
● PAN Card ● Trade Licence ● Establishment Certificate ● GST/Sales Tax Certificate |
|
Other Essential Documents |
● Sole Proprietorship Declaration ● Certified Copy of the Partnership Deed ● Certified True Copy of the Memorandum & Articles of Association (certified by the company Director) ● Board Resolution |
Where a co-applicant is mentioned in the application, their KYC, PAN/Form 60, and necessary supporting papers must also be submitted for verification.
This checklist is indicative. Based on the specific loan option and your individual/business profile, additional documentation may be requested as per policy norms at the time of loan application.
- Original identity, address, or other essential documents may be required for on-site verification if applicable. If the digital KYC process is completed, this step may not be needed.
- If your submitted address proof does not match your current place of residence, a Deemed OVD may be accepted. Click here to see the approved list.
- A valid OVD containing your correct address must be provided within three months from the date the initial address document was submitted.
SME/MSME Loan Interest Rates
SME Loan Interest Rate:
Depending on various factors such as location, net income, business stability, existing monthly obligations, etc., the SME loan interest rate can vary. If the borrower owns a business and is a self-employed individual, SMFG India Credit offers personal loans for self-employed individuals at affordable interest rates.
MSME Loan Interest Rate:
The MSME loan interest rate is minimal and based on a number of parameters like the nature of business, industry type, number of years in existence, financials, and so on.
|
Loan Details |
SMFG India Credit’s SME/MSME Loan Charges |
|
Processing fee |
Up to 5% of the total loan amount + GST |
|
Loan tenure |
Between 12 months and 60 months |
|
Pre-closure charges |
Range from 0% to 7% |
|
Eligibility criteria |
Turnover should be at least Rs. 10 lakhs* with 2 years of profit-making business. |
|
Loan amounts |
Range from Rs. 50,000 to Rs. 1 crore* |
How to Apply for SME/MSME Loan?
At SMFG India Credit, you can apply for an MSME loan online or by visiting your nearest branch office.
If you wish to apply for an MSME loan online, follow these easy steps:
- Begin your online application here and choose the “Business Loan/SME Loan” option. Provide the required details, upload the necessary documents, select your preferred tenure and indicate the amount you wish to borrow.
- Submit your form to receive an initial assessment based on the information shared.
- If your application is approved for further processing, a unique reference number will be generated for tracking your request.
- You may be contacted by an SMFG India Credit representative if further information or supporting paperwork is needed.
- Once evaluation and verification are completed, you will receive a customised loan offer. Upon acceptance, loan disbursement will take place, and the funds will be sent directly to your account.
Why Opt for SMFG India Credit’s SME Loans?
Transparent and Fast-tracked Loan Disbursement Procedures
We try to keep our SME loan procedures transparent so that customers can make an informed decision. We provide easy online access to various tools to check your eligibility and loan application requirements, such as our business loan eligibility calculator, business loan EMI calculator, and documentation list. For SME funding requirements up to Rs. 1 crore*, we offer affordable and competitive business loan interest rates and aim for easy and fast-tracked disbursements of collateral-free loans.
Flexibility in Loan Repayment
We offer ample flexibility to our customers with respect to the repayment schedule. You may schedule your loan repayment with us, anywhere between 12 and 60 months, based on your receivables. Similarly, if you want an early settlement of your loan, we offer foreclosure options without any extra charges*.
Online SME Loan Processing
Applying for SME loans at SMFG India Credit has been made quicker through the online application procedures. Based on your eligibility, desired tenure, and loan amount, with the relevant documentation, we provide you with a customised offer with the best available interest rates and terms.
*Subject to terms and conditions
Latest MSME Investment and Turnover Limits for MSMEs
The turnover and investment limits help with correct MSME classification and determining eligibility for benefits such as government schemes and various MSME funding options. These limits ensure that appropriate credit support reaches the right enterprises.
By understanding where your business fits, you can also plan working capital management more effectively and apply for the most suitable loan options.
|
Type of Business |
Investment Limit (Rs) |
Turnover Limit (Rs) |
|
Micro Business |
2.5 crore |
10 crores |
|
Small Business |
25 crores |
100 crores |
|
Medium Business |
50 crores |
500 crores |
Purpose of MSME/SME Loans
The purpose of MSME/SME loans is to help small and medium businesses manage daily operations, improve cash flow, and support overall growth. These loans can be used for a wide range of business needs without putting undue pressure on existing finances.
Common purposes of MSME/SME loans include:
- Covering day-to-day expenses such as salaries, rent, and utility bills
- Purchasing raw materials and maintaining inventory
- Funding business expansion or setting up new branches
- Investing in new equipment, machinery, or technology upgrades
- Managing cash flow gaps through business working capital loans
Types of MSME/SME Loans
There are different types of MSME loan options available to meet varied business needs. Each option is designed for a specific purpose, whether it involves long-term growth, short-term financing, or managing daily operations. Selecting the right loan type helps support better working capital management, smoother loan repayment, and improved cash flow.
Common types of MSME/SME loans include:
- Term Loans: Ideal for business expansion, purchasing equipment, or setting up new facilities. These loans come with a fixed loan tenure and structured EMI payments.
- CGTMSE Loans: Provided under the Credit Guarantee Fund Scheme for MSMEs, these collateral-free loans enhance loan eligibility for small enterprises.
- MUDRA Loans: Tailored for micro and small businesses to support startup requirements and day-to-day operations at affordable interest rates.
- Stand-Up India Loans: Designed to promote entrepreneurship among women and SC/ST business owners by offering accessible credit.
- Government Subsidy Loans: Offer financial support with competitive interest rates, helping MSMEs grow and adopt new technologies.
How to Calculate MSME/SME Loans EMI?
To calculate your MSME/SME loan EMI (Equated Monthly Instalment) manually, use this formula:
EMI = P x r x (1+r)n/ (1 + r) n-1
Don’t worry, you don't have to calculate this entire equation. Just enter your loan amount (P), interest rate (r), and loan term (n) into SMFG India Credit’s business loan EMI calculator. Once you have opened the calculator, you can adjust the values to find the optimal combination that aligns with your budget. This user-friendly tool aids you in exploring various scenarios and empowers you to make informed decisions regarding your SME loan.
Want to Take Your Business Further? Find Out How!
Watch the journey of a small retailer and discover how the right business loan can support growth, improve cash flow, and open new opportunities.
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* Please note that loans are disbursed at the sole discretion of SMFG India Credit. Final approval, loan terms and disbursal process will be subject to SMFG India Credit's policy at the time of loan application. If you are an existing customer and wish to foreclose your loan, please note that foreclosure terms and charges will be applicable as per our policy at the time of loan foreclosure.
FAQs on SME / MSME Loan
What is an SME?
According to the definition laid down by the regulatory authorities, certain companies are classified as small or medium enterprises in the manufacturing and service sectors. These industries are further subdivided based on the amount of capital invested and the turnover they generate. For an enterprise to be classified as a small enterprise, an enterprise should have an investment of not more than Rs. 25 crores and a turnover of not more than Rs. 100 crores. A medium enterprise should have investments not more than Rs. 50 crores and a turnover not more than Rs. 500 crores.
What is MSME?
The MSME full form is Micro, Small, and Medium Enterprises. MSME entities are set up under the Micro, Small & Medium Enterprises Development (MSMED) Act, 2006, and have contributed greatly to India’s economy, and have been rightly considered as its backbone. MSME’s are engaged in the production, manufacturing, processing, or preservation of goods and commodities. They have resulted in the development of the backward and rural areas of the country, in increasing exports, promoting industrialisation, and generating employment opportunities.
What is an SME loan?
SME loans can be best defined as the loans extended to SMEs to cater to their business requirements and provide the funding required for expansion, working capital, and infrastructure/business development.
What is an MSME loan?
An MSME loan is financial support and benefit provided to the enterprises that fall within the criteria of MSME and have registered for the same. This is a collateral-free loan that is given to MSME enterprises to provide support of finance, for building their infrastructure and other needs as per their specific needs.
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