Role of Schemes for Small Businesses

January 23, 2017by Team CapitaWorld0

MSME sector plays a major role in contributing to the growth of Indian economy. The primary factors
assisting this growth being:

  • 45% of the industrial output,
  • 40% of exports,
  • Creating one million jobs every year,
  • Producing more than 8000 quality products for the Indian and international markets.

MSMEs are today exposed to greater opportunities for expansion and diversification across the sectors.

MUDRA Yojana

To develop the MICRO enterprise sector by “Funding the unfunded”.

Providing Business loan for vendors, traders, shopkeeper etc., Working capital loan, Equipment finance,
Transport vehicle loans.

Rate of Interest
Under MUDRA Yojana rate of interest would be lower.

In the financial year 2016-17, the number of Yojna was 2,04,73,206 where government sanctioned loan
amount of Rs. 77,736.97 Crores and loan disbursed for an amount of Rs.75,094.97 Crores. Approx.
96.61% of sanctioned loan has been disbursed during the years which shows the fast approval and
disbursement of the loan.


  • Rate of Interest is cheap.
  • Security or collateral is not required for loans.
  • Processing fees of loan is zero.
  • Financial problem faced in setting up can be solved.
  • Credit can be availed in an easy manner.

StandUp India

Facilitate loans to at least 1 Scheduled Caste or Scheduled Tribe borrower plus at least 1 Women
borrower per bank branch for setting up an enterprise in manufacturing, service or trading sector. In the
case of for an amount between Rs.10 Lakhs and Rs.1 Crore. In the case of a Non-Individual enterprise, at
least 51% of shareholding and controlling stake should be held by either an SC/ST or women

The purpose is to give benefit to a new enterprise in manufacturing, trading or service sector by
SC/ST/Women entrepreneur.

Rate of Interest
The rate of interest on the loan would be the lowest rate of the bank for that category not to exceed
MCLR+ tenor premium.

Up to the Year 2017, 3400 online applications submitted, 790 online loan sanctions, 1470 online request
for handholding responded, 94 banks with 105000+ branches active on the portal, 23300+ registrations.


  • Smooth and easy way to access capital,
  • Refinancing options,
  • Support and training at all level,
  • Involvement of woman entrepreneur increased,
  • Convenience of connect centers as they are available almost everywhere.

Government has witnessed that lot many startups have stopped operating, the primary reason being the
shortage of funds. Looking at this situation, the GOI has launched the scheme of Startup India to support
emerging business and entrepreneur.

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