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MSME loan in Jalandhar

The smart city of Jalandhar is known for its mythical origin and reminiscence of history. Home to nearly 20,042 small and medium industries, Jalandhar has been a significant contributor to Punjab’s economy. From the outsized agriculture sector to small highway dhabas, this city is rapidly creating opportunities for micro, small and medium-scale enterprises.

Moreover, the city keeps attracting the populace with employment prospects from various parts of Punjab, especially the rural areas. This influx creates a significant market for budding and already-established enterprises.

Micro, small, and medium-scale companies based on Jalandhar can capitalise on these opportunities better with an MSME loan/SME loan in Jalandhar. The funds can be used to meet various expenses in their company without hurting the business finances.

What Is An MSME Loan?

As the name suggests, an MSME loan is designed to cater to the funding requirements of micro, small, and medium enterprises. Both government schemes, as well as private financiers, extend this financing option. Government options include MSME loan scheme 2020, Prime Minister Employment Generation Programme, etc.

What Are The Characteristics Of An MSME loan?

Here are some of the characteristics of an MSME loan Jalandhar:

  • Loan Amount: Businesspersons in this city can raise funds of up to Rs. 1 crore by availing an MSME project loan.
  • Repayment Period: Individuals can repay the sanctioned loan amount within a period of 1 to 5 years. Depending on the lender and the scheme, the tenure can be as long as 15 years.
  • Fixed Interest Rate: MSME interest rate is fixed throughout the entire tenure, which enables individuals to manage their finances better as they know the monthly instalment amount beforehand.
  • Processing Time: The approval time for MSME loans can differ based on the source. Private lenders usually approve loans within 24 hours if it’s their own offering. For government-backed loans, approval can be time-consuming owing to extensive formalities.
  • Disbursal Period: Post-approval, borrowers can receive the sanctioned amount within 24 hours if it’s obtained directly from financial institutions. However, for government schemes, this period can stretch up to a week or more than that.
  • Interest Rates: Interest rates on collateral-free loans provided by banks and NBFCs are usually high. It also depends on a person’s MSME loan eligibility. A highly eligible applicant can secure an MSME loan at low-interest rates and vice versa.

End-use Restrictions: Government-backed MSME loans often involve end-use restriction, meaning borrowers can only use the amount for meeting a specific purpose. Bank loans, on the other hand, are free of such constraints. Enterprises can utilise such a loan for various purposes.

How Can an MSME Loan/SME Loan In Jalandhar Help?

Here’s how MSME loans can help businesspersons:

  • Strengthen Working Capital: All enterprises, whatever the scale of operations may be, require a sufficient amount of funds to purchase raw materials, pay overheads and more. In the case of working capital shortage, business owners can take out an MSME project loan to ensure that the daily operations are carried out smoothly.
  • Purchase Of Machinery: Individuals can avail an MSME loan for machinery to purchase new equipment, increase the production volume, and maximise revenue.
  • Implement New Strategies: Putting a plan into action can be challenging for many budding and established entrepreneurs, especially if it requires sizeable funding. MSME loans allow businesses to implement a strategy and increase their conversions.
  • Boost Marketing: Both digital and offline marketing strategies require a considerable capital injection that may not be available with growing businesses. To combat this issue, they can avail an MSME loan/SME loan in Jalandhar.

Who Can Take Out An MSME Loan/SME Loan In Jalandhar?

To obtain funding from government-backed schemes, organisations need to meet the eligibility parameters set for MSMEs. This eligibility is based on two premises, primarily –

  • Annual turnover
  • Yearly revenue

MSME/SMEs considering term loans from banks or NBFCs have to satisfy a different range of criteria. Following are the general MSME loan eligibility criteria necessary to be fulfilled by a potential borrower.

  • High CIBIL score (750+)
  • The entrepreneur has to show a bona fide vintage of the business. It must be in operation from 6 months to 1 year.
  • One has to disclose the financial records of the company
  • Details on the business type and balance sheet
  • A remarkable credit history
  • The applicant must be aged between 25-65 years

It is recommended to check the MSME loan procedure and terms before proceeding with the application.

Apart from satisfying these parameters, a borrower needs to submit the following documents –

  • The company’s bank statements for the last six months and ITR of the two years
  • Balance sheet and Income statements for the preceding two years assessed by CA
  • Memorandum & Articles of Association, registration of the corporation, partnership deed, PAN card and other KYC documents

The extensive parameter checks and documentation can make the process for loan disbursal time-consuming. It can become a burden for an entrepreneur requiring emergency funds.

In this regard, a gold loan offered by Rupeek can prove to be a better alternative. Individuals can obtain funding against their gold articles with only their KYC documents. Moreover, contrary to MSME loans, this form of financial assistance involves lenient eligibility criteria and low interest rates. Residents of the following areas in Jalandhar can avail our doorstep services.

  • Jalandhar Cantt
  • Model Town
  • Phillaur
  • Dayanand Nagar
  • Goraya
  • Rama Mandi
  • Jandu Singha
  • Lajpat Nagar
  • Banga
  • Apra

So, you can finally stop scanning Google for ‘MSME loan providers near me’ and contact Rupeek to ensure a hassle-free loan disbursal experience. Place a request via our app, and our loan manager will arrive at your location within 30 minutes to complete the necessary formalities for availing a gold-backed MSME loan/SME loan in Jalandhar.

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Benefits of Gold Loan over MSME/SME loan.
Today's maximum loan value/gm **
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Last Updated :

  • <1 lakh
  • 2 lakh
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Comparision Parameters MSME / SME Loan Gold loan
Interest Rate 2.39% .79%
Monthly Interest Amount
Eligibility & Documentation More Documents Needed Only KYC Needed
Processing Time & Disbursement 2 days to 1 week Within a day
Required Gold Weight -
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Frequently asked questions

  1. Can I get an SME loan if I am still repaying a personal loan?

Individuals can opt for an MSME loan even if they are repaying an existing personal loan. However, they must keep in mind that lending institutions sanction an unsecured MSME loan if the borrower’s credit score is at least 750. He/she must also boast a standard FOIR, preferably below 50%, to be eligible.

  1. Can I use an MSME loan/SME loan in Jalandhar for medical emergencies?

It depends on the source. An MSME business loan offered through govt. schemes come with end-use limitations. Therefore, individuals cannot use the loan amount to finance expenses that are unrelated to their business.

  1. Will my credit score decrease for late payment of MSME loan EMIs?

Yes, not paying your MSME loan EMIs on time will have an impact on your credit score. This will hamper your chances of getting financial assistance in the future. Hence, it’s imperative that borrowers pay their monthly instalments on time.

  1. How can I calculate the EMI of MSME loans?

Borrowers can conveniently compute their MSME loan EMIs by taking the help of an online MSME business loan calculator. These tools are provided by financial institutions free of cost.

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