CleanEdge Accelerator Program

Now startups and MSMEs can apply for business loans. See what makes you eligible.

With more than 37,000 startups and 577Cr MSMEs emerging in India, the market is witnessing a new age of business. The Indian Business Ecosystem is flooding with such companies since the Startup India campaign was announced in 2015. Startup or MSME businesses are ideas that need to be executed. To execute those ideas, the companies need working capital to set things in motion. But where do they get these funding from? The answer is investors and banks who are interested in your business idea and are ready to fund your business for the same.

Now that the investors and banks are interested in startups & such MSMEs, we need to know the eligibility criteria to apply for those loans. While most investors have their own set of eligibility criteria, there are few basic ones that you need to meet before you can apply for a business loan.

Startup Business Loan Eligibility Criteria

A startup is merely an idea upon which the investors are granting the funds. That’s why to ensure the security of their money; every lender has different criteria to declare a startup eligible for a loan. However, a few general points to be remembered are as follows:

  •  There should be a firm and convincing business plan.
  • The applicant’s age should be between 21 to 65 years.
  • The applicant should be a citizen of India.
  • The startup should be formed as a private limited or with a limited liability partnership.
  • Total turnover of the firm should not exceed Rs.25cr.
  • A PAN card for the company.

MSME Business Loan Eligibility Criteria

MSMEs are the micro, small and medium enterprise that requires funding for various activities such as buy machinery, purchase raw material & fixed assets, etc. To apply for MSME business loans, you need to fulfil a few eligibility criteria to apply for a loan with investors. These basic norms are as follows:

  • The applicant should be a resident of India.
  • The applicant should be of age between 25 and 65 years.
  • The business should be at least three years old (Business vintage).
  • The business should fall under either category – manufacturing or service sector.
  • The investment limits for the micro, small & medium enterprises are varied based on the type they fall into.
    • For the manufacturing sector
      • Micro – less than Rs. 25 Lakh
      • Small – Between Rs. 25 Lakh and Rs. 5 crores
      • Medium – Between Rs. 5 crores and Rs. 10 crores.
    • For the service sector
      • Micro – Less than Rs. 10 Lakh.
      • Small – Between Rs. 10 Lakh and Rs. 2 crores
      • Medium – Between Rs. 2 crores and Rs. 5 crores.
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