Bank Loans
Funding Your Business with Bank Loans
Getting the right funding is one of the biggest challenges for new entrepreneurs in India. The good news is that banks and financial institutions offer a wide range of loan products specifically for small businesses and startups. MUDRA loans (under Pradhan Mantri MUDRA Yojana) are among the most popular, covering amounts from Rs 50,000 to Rs 10 lakh without requiring collateral.
For larger funding needs, MSME loans from banks like SBI, PNB, Bank of Baroda, and Canara Bank can go up to Rs 5 crore depending on the scheme. SIDBI and NABARD offer specialized financing for industrial and rural ventures. Many of these loans come with subsidized interest rates and flexible repayment terms when combined with government schemes like CGTMSE or PMEGP.
Before applying, it helps to have your business plan and project report ready, along with KYC documents and financial projections. Compare interest rates, processing fees, and eligibility criteria across different banks. The loan profiles below give you all the details for each product so you can find the best fit for your business needs.
Showing 18 of 20 loan products
Axis Bank Business Loan
Axis Bank
Axis Bank offers unsecured business loans up to 50 lakh rupees for established businesses, with minimal documentation and quick approval within 3 working days. Flexible EMI options, no collateral requirements, and competitive rates for borrowers with strong credit profiles make this a popular choice among small and medium businesses. Axis also offers MSME Easy Access Loan with doorstep service, where bank representatives visit the borrower's premises for documentation and verification, which is particularly helpful for busy entrepreneurs who cannot make multiple branch visits. The bank's business loan product suits established traders, manufacturers, service providers, and professionals with at least 3 years of business vintage and stable turnover above 50 lakh rupees.
Bandhan Bank Micro Enterprise Loan
Bandhan Bank
Bandhan Bank specialises in microfinance and micro enterprise loans, particularly for rural and semi-urban borrowers who have historically been underserved by mainstream banking. Loans range from 10,000 rupees to 10 lakh rupees for income-generating activities including dairy, tailoring, petty trading, small manufacturing, and services. Known for doorstep service, group lending through Joint Liability Groups (JLG), and simple documentation that makes the bank uniquely accessible to first-time borrowers without formal business registration. Bandhan evolved from a microfinance institution into a full-service bank, which gives it strong field-level presence with micro credit officers who visit borrower locations for verification and collection. The bank's micro enterprise product is ideal for women entrepreneurs and rural micro businesses.
Bank of Baroda Startup Loan
Bank of Baroda
Bank of Baroda (BoB) offers dedicated loan products for startups and MSMEs through its extensive branch network and digital lending platforms. Their MSME loans cover term loans for machinery and equipment purchase, working capital lines of credit, and composite loans for new enterprises combining both. Special schemes are available for DPIIT-recognised startups with relaxed collateral requirements, faster processing, and interest rate concessions compared to standard commercial loans. BoB supports MSMEs up to 50 lakh rupees with CGTMSE coverage reducing collateral requirements significantly. Applications can be initiated through any BoB branch or via the bob World mobile app, with digital end-to-end processing available for smaller ticket sizes.
Bank of India – Stand Up India Loan
Bank of India
Bank of India's Stand Up India loan provides 10 lakh to 1 crore rupees for SC/ST and women entrepreneurs to set up greenfield enterprises in manufacturing, services, agri-allied activities, or trading. Composite loans cover both term loan and working capital with a moratorium period of up to 18 months, giving new businesses time to stabilise before repayments begin. Bank of India is one of the more active public sector banks under the Stand Up India programme and provides structured handholding support through Lead District Managers at branch level. Applicants should expect thorough project appraisal during the sanction process, typically taking 4 to 6 weeks from complete documentation to loan disbursement.
Canara Bank MSME Loan
Canara Bank
Canara Bank offers comprehensive MSME loan products including term loans, working capital, and composite loans for micro, small, and medium enterprises across manufacturing and service sectors. Competitive interest rates, CGTMSE coverage for collateral-free lending up to 5 lakh rupees, and dedicated MSME Sulabh branches for faster processing make it one of the more accessible public sector banks for MSME borrowers. Canara Bank loans suit businesses looking for medium-ticket credit ranging from 10 to 25 lakh rupees, with repayment tenure up to 7 years. Applications can be processed at any Canara Bank branch or through the bank's digital lending platform.
Central Bank of India MUDRA Loan
Central Bank of India
Central Bank of India offers MUDRA loans across all three categories (Shishu, Kishore, and Tarun) with a focus on priority sector lending to small and micro enterprises. As one of India's oldest nationalised banks, it has an extensive rural and semi-urban branch network that makes MUDRA loans accessible in underserved areas where many private banks lack presence. Central Bank regularly organises MUDRA camps and outreach drives at district and block levels to accelerate loan disbursement and reach first-time borrowers. The bank's processing timelines are typically 7 to 21 days depending on the MUDRA category, and applications can be submitted at any branch with minimal documentation, particularly for Shishu-category loans up to 50,000 rupees.
Federal Bank MSME Loan
Federal Bank
Federal Bank offers MSME loans with quick processing and dedicated relationship managers, distinguished among mid-sized private banks for its digital-first approach and responsive customer service. Products include term loans for equipment and expansion, working capital lines of credit, and trade finance for import-export businesses. Known for strong presence in South India (particularly Kerala where the bank originated) and competitive rates for manufacturing MSMEs. Federal Bank's FedNxt digital platform enables online loan applications with real-time tracking, and relationship managers provide guidance from application through disbursement. CGTMSE cover is available for collateral-free lending up to 5 lakh rupees, and larger loans can be secured with appropriate collateral or financial guarantees.
HDFC SmartUp Business Loan
HDFC Bank
HDFC Bank SmartUp is a dedicated business loan product for startups and emerging businesses launched by India's largest private sector bank. It provides both term loans and working capital facilities with minimal documentation and fast processing (typically 3 to 7 working days). HDFC also partners with Startup India to offer preferential rates to DPIIT-recognised startups, with interest concessions and relaxed collateral norms that support early-stage growth. The product is particularly useful for startups with 1 to 3 years of vintage that need working capital beyond what MUDRA loans can provide. Loans up to 40 lakh rupees are available unsecured based on borrower profile, with secured options going up to 50 lakh rupees.
ICICI Bank MSME Loan
ICICI Bank
ICICI Bank offers a comprehensive range of MSME loan products including business loans, machinery loans, working capital lines of credit, and trade finance for import-export businesses. Known for quick digital processing with loans up to 2 crore rupees, ICICI is one of the most active private sector banks in MSME lending. The bank offers both secured and unsecured options with competitive rates for businesses with good credit history (CIBIL 750+). Specialised products include professional loans for doctors, chartered accountants, and architects, along with sector-specific credit lines for pharma, textiles, and auto components. ICICI's InstaBIZ mobile app supports end-to-end digital loan processing for smaller tickets, reducing sanctioning time to as little as 24 to 72 hours.
IDBI Bank MSME Loan
IDBI Bank
IDBI Bank provides tailored MSME loan solutions including project finance, working capital, equipment finance, and micro loans. Known for supporting manufacturing MSMEs with specialised technical evaluation capabilities inherited from its development banking history (IDBI was originally established as a development financial institution). IDBI is particularly strong for project finance where new manufacturing units require technical due diligence of plant layout, production capacity, and raw material sourcing. Loans up to 50 lakh rupees are supported with CGTMSE cover reducing collateral requirements. IDBI MSME loans suit growing manufacturing businesses needing structured capital for plant and machinery investments with medium-term repayment horizons.
Indian Bank MSME Loan
Indian Bank
Indian Bank provides MSME loans for both new and existing enterprises covering machinery purchase, working capital, business expansion, and composite credit lines. The bank has been consistently recognised for MSME lending performance and offers competitive rates with relatively quick turnaround. Indian Bank has particular strength in South Indian states where it originated, and the 2020 merger with Allahabad Bank expanded its branch network significantly across eastern and northern India. CGTMSE coverage is available for collateral-free lending up to 5 lakh rupees, while MUDRA loans are processed under the standard nil-collateral norms. The bank's dedicated MSME loan officers provide guidance throughout the application process.
NABARD Dairy Entrepreneurship Development Scheme
National Bank for Agriculture and Rural Development (NABARD)
NABARD's Dairy Entrepreneurship Development Scheme (DEDS) provides capital subsidy for dairy farming and related agri-allied activities across India. Subsidy of 25 percent (33.33 percent for SC/ST beneficiaries) on investments for establishing small dairy units, purchase of milch animals, milk processing equipment, bulk milk coolers, and cold chain infrastructure. The scheme covers end-to-end dairy value chain including breeding of heifer calves, milking parlour construction, and value-added dairy product manufacturing. DEDS works through commercial banks, regional rural banks, and cooperative banks with NABARD providing back-end subsidy after loan sanction. The scheme has supported hundreds of thousands of rural entrepreneurs in building sustainable dairy livelihoods across Indian villages.
PNB MUDRA Loan
Punjab National Bank
Punjab National Bank (PNB) offers MUDRA loans across all three categories: Shishu (up to 50,000), Kishore (50,001 to 5 lakh), and Tarun (5,00,001 to 10 lakh). PNB has one of the largest branch networks in India with over 10,000 branches, making MUDRA loans genuinely accessible even in tier 3 and tier 4 cities where other banks may not have meaningful presence. The bank places special focus on lending to women, SC/ST, and minority entrepreneurs, aligned with government priority sector lending targets. Applications can be submitted at any PNB branch or through the PNB ONE mobile app, with processing typically completed within 7 to 21 working days depending on loan category.
SBI e-Mudra Loan (Instant Digital)
State Bank of India
SBI e-Mudra is an instant digital MUDRA loan available through the SBI YONO app, designed for existing SBI customers who need quick small-ticket working capital. Get up to 1 lakh rupees sanctioned in minutes without visiting a branch, with the loan amount credited to your SBI account instantly after digital verification. Pre-approved for eligible SBI account holders based on transaction history, CIBIL score (typically 700+), and account stability. The completely paperless process uses Aadhaar-based e-KYC and OTP verification, eliminating physical documentation entirely. This product suits small shop owners, street vendors, and home-based businesses that already maintain SBI accounts and need emergency working capital without the friction of branch visits.
SBI MUDRA Loan – Kishore
State Bank of India
SBI MUDRA Kishore loan caters to entrepreneurs who have established their business and need funds for expansion, equipment purchase, or increased working capital. Loans range from 50,001 to 5 lakh rupees covering both working capital and term loan needs, with repayment tenure up to 5 years. No collateral is required, and the loan is typically available to businesses with at least one year of operational track record. SBI processes Kishore MUDRA loans within 14 to 21 working days after complete documentation, and the loan is accessible through any SBI branch across India as well as the SBI YONO app.
SBI MUDRA Loan – Shishu
State Bank of India
SBI's MUDRA Shishu loan provides up to 50,000 rupees for new and budding entrepreneurs starting small businesses across manufacturing, trading, and service sectors. No collateral is required, documentation is minimal, and processing typically happens within 7 to 14 working days. This loan is ideal for street vendors, home-based businesses, artisans, tiffin services, tailoring units, small kirana shops, and first-time entrepreneurs who need modest working capital to launch. As India's largest public sector bank, SBI processes a significant share of MUDRA Shishu loans nationwide, and applicants can approach any SBI branch to initiate the process.
SBI MUDRA Loan – Tarun
State Bank of India
SBI MUDRA Tarun is the highest tier under MUDRA, providing 5,00,001 to 10,00,000 rupees for well-established micro enterprises needing significant capital for expansion, new equipment purchase, additional working capital, or scaling operations. The loan is available to businesses with at least 2 years of track record, minimum 5 lakh turnover, and good credit history. CGTMSE guarantee covers collateral-free lending at this tier. Tarun loans suit businesses that have outgrown their initial operations and need substantial capital to hire more employees, invest in production equipment, or expand to new geographies. Repayment tenure is up to 5 years, with processing time of 21 to 30 working days.
SIDBI Fund of Funds for Startups
Small Industries Development Bank of India (SIDBI)
SIDBI manages the Government's 10,000 crore rupee Fund of Funds for Startups (FFS) under the Startup India initiative. SIDBI does not directly invest in startups but invests in SEBI-registered Alternative Investment Funds (Venture Capital funds), which in turn invest in Indian startups. This indirect structure catalyses private investment by providing foundational LP capital that gives VCs confidence to raise larger private pools. The FFS has committed capital to over 100 AIFs which have collectively backed thousands of Indian startups across fintech, SaaS, healthtech, edtech, and climate technology. Founders seeking FFS-linked capital apply directly to VCs whose funds received SIDBI commitment, not to SIDBI itself.
EduMetrics aggregates bank loan information from public sources for educational purposes. Interest rates, terms, and eligibility criteria are subject to change. All bank names and trademarks belong to their respective owners.