How to Get MSME Loan

April 26, 2018, Posted By : Team Yomillio

Yomillio, in partnership with the Confederation of Indian MSMEs (CIMSME) recently organized an event called “Community Sales for SMEs.”

Apart from sales experts who showed attendees how to break through the crowd and sell, the list of speakers also included two government officials from SIDBI and MSME Ministry who talked about how they help MSMEs with funding, technical assistance, training, vendor registration, government contracts, etc.

Gopinath Rao at Yomillio Sales for SMEs eventIn this post, I want to share with you the insights we gained at our seminar, which ended up as a Q&A on how to get MSME loan for your business.

Let’s start with Gopinath Rao, Asst. Director at the MSME Development Institute in Bangalore.

He started off by informing us that the Government of India recently modified the official definition of MSME. It is now based on turnover.

MSME definition for manufacturing, production, processing and preservation of goods.

Micro

Investment in plant and machinery must not exceed Rs. 25 lakh;

Small

Investment in plant and machinery must not be less than Rs. 25 lakh and must not exceed Rs. 5 crore; and

Medium

Investment in plant and machinery must not be less than Rs. 5 crore and must not exceed Rs. 10 crore.

MSME definition for service providers.

Micro

Investment in equipment must not exceed Rs. 10 lakh;

Small

Investment in equipment must not be less than Rs. 10 lakh and must not exceed Rs. 2 crore; and

Medium

Investment in equipment must not be less than Rs. 2 crore and must not exceed Rs. 5 crore.

Now you know under which part of MSME you are in.

Another question was whether software and tech companies (meaning startups) can be classified as MSME. The answer is YES, and you can register as an MSME online at Udyog Aadhaar (udyogaadhaar.gov.in). This portal is maintained by the Ministry of Micro, Small and Medium Enterprises, and is the official website for MSME registration.

MSME loan checklist, documents and online application to 145 lenders

You can simply walk into any public, private or cooperative bank or even NBFC and apply for an MSME loan, and they’ll consider it based on the merits of your proposal. But it helps if you complete the following items in the MSME checklist below.

1. MSME registration on Udyog Aadhaar.

2. Attend one-day training programme organized by MSME Development Institute near you (Bangalore MSME DI – Address: Rajaji Nagar Industrial Estate, West of Chord Road, Bengaluru, Karnataka 560010; Phone: 080 2315 1581; Website: http://www.msmedibangalore.gov.in/).

3. Get MSME DI to prepare a project report for you. It’s part of the scope of the assistance they provide to MSMEs, so that you are prepared for fulfilling all the requirements that a bank or other lender will ask for.

4. Collect all the documents required for the MSME loan application. Click here to download the entire checklist from udyamimitra.in. It contains the complete list of documents you will need for a loan of up to Rs. 10 crore.

5. Now you can apply online for your MSME loan. You don’t have to go to 10 different banks and lenders. This application form, submitted online on the Udyamimitra portal, will be accessible by over 145 lenders including banks, NBFCs, SFBs and FinTechs.

Contacts if you need help with MSME

One of the takeaways from the event where officials from SIDBI and MSME DI spoke how to get msme loanwas that they left their contact numbers and emails, and said that you can contact them anytime or come to their office, if you need any kind of help related to your MSME project.

In the public interest, Yomillio is sharing these contacts with you. Please feel free to call Gopinath Rao from MSME DI or Gunaseelan from SIDBI to get help for your project.

Yomillio business networkingBecome a Yomillio member today. We’ll put your MSME project on the fast track. Assistance with funding, sales, branding, vendors, equipment and any other business challenge that is slowing you down.

Attend industry events to meet and connect with business leaders, government officials and other useful people who can give you business, help grow your business, and make it a brand-name business.

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