MSMEs (Micro, Small and Medium Enterprises) play a crucial role in the growth and development of the Indian economy. However, the growth of MSMEs is often hindered by a lack of access to finance. To overcome this challenge, the government has introduced several loan schemes that cater to the specific needs of MSMEs. Odisha is one of the most promising states in India when it comes to MSMEs. The state government of Odisha has launched several loan schemes to support the growth of MSMEs in the state. In this article, we will discuss some of the most popular loan schemes available for MSMEs in Odisha.
Gramodyog Rozgar Yojana (GRY)
GRY is a loan scheme that aims to promote rural entrepreneurship in Odisha. The scheme is implemented by the Khadi and Village Industries Commission (KVIC) through its state and district offices. Through this scheme, the beneficiaries will get financial assistance in the form of loans and grants with competitive interest rates as well as flexible repayment tenure. The scheme also provides training and skill development programs to the beneficiaries to help them set up and run their businesses successfully. Following are some of its key highlights:
| Loan amount | ₹10,000 to ₹25 lakhs |
|---|---|
| Interest rates | 4% per annum for general category beneficiaries and 2% per annum for SC/ST, women, and differently-abled beneficiaries |
| Rural/Urban | Only available to Rural areas |
| Loan tenure | 7 years |
| Gender | Male/Female |
Mukhyamantri Krushi Udyog Yojana Odisha
The Mukhyamantri Krushi Udyog Yojana Odisha is an MSME loan scheme that aims to provide financial assistance to small and marginal farmers, entrepreneurs, and unemployed youth in the state of Odisha. The scheme provides loans to purchase land, equipment, and tools. The scheme also provides for the training of farmers and entrepreneurs to improve their skills and knowledge. Following are some of its key highlights:
| Loan amount | ₹10 lakhs to ₹25 crores |
|---|---|
| Interest rates | 4% to 9% per annum |
| Rural/Urban | Available for both rural and urban residents |
| Loan tenure | 7 years |
| Margin money subsidy | 25% of the project cost for SC/ST, women, and differently-abled beneficiaries |
PM Vishwakarma Scheme
This scheme was launched on 17th September 2023 by Prime Minister, Narendra Modi, on the occasion of Vishwakarma Jayanti. It provides skill training and financial assistance to traditional artisans and craftsmen across the country. This scheme also provides an interest subvention of 8% on the loan amount. Following are some of its main highlights:
| Loan amount | Up to ₹3 lakh |
|---|---|
| Interest rates | 5% |
| Rural/Urban | Available for both rural and urban residents |
| Loan tenure | 18-30 months |
| Gender | Both male and female |
Credit Linked Capital Subsidy Scheme (CLCSS)
Credit Linked Capital Subsidy Scheme was launched in October 2000 by the Government of India. This scheme provides necessary funds to MSMEs for upgrading their existing technologies. Enterprises can use this scheme to upgrade their existing plant and machinery and increase profit. This scheme has no upper loan limit, but the subsidy is calculated on the loan amount sanctioned for P&M purchase only. The following are its main features:
| Loan amount | No upper limit |
|---|---|
| Subsidy | 15% of the loan amount |
| Annual guarantee fee | 0.75%-1.0% |
| Loan tenure | Flexible tenure depending upon the repayment capacity |
Pradhan Mantri MUDRA Yojana (PMMY)
The Pradhan Mantri MUDRA Yojana (PMMY) is a flagship central government scheme launched in 2015. It provides micro-loans to non-corporate, non-farm micro and small enterprises in both rural and urban areas.
PMMY offers loans under three categories, depending on the stages of business growth and funding needs:
- Shishu Mudra: Up to Rs. 50,000
- Kishore Mudra: Rs. 50,001 to Rs. 5 lakh
- Tarun Mudra: Rs. 5 lakh to Rs. 10 lakh
MUDRA loans are availed through various financial institutions, including Public sector banks, Private sector banks, Regional Rural Banks, Small Finance Banks, Microfinance Institutions, and Non-Banking Financial Companies (NBFCs).
Unlike other loan schemes, PMMY doesn’t have specific criteria for age, gender, tenure, interest rates, etc. All these factors can vary based on the category of the loan and the policies of the lending institution.
Prime Minister’s Employment Generation Programme (PMEGP)
PMEGP is a credit-linked subsidy scheme administered by the Ministry of Micro, Small and Medium Enterprises (MSME), which aims at creating job opportunities by establishing micro-enterprises. The main target of this scheme is Women, Traditional and prospective artisans and Unemployed youth. The following are some of its main features:
| Age | Minimum age of 18 |
|---|---|
| Interest rate | Between 11% -12% depending on the bank |
| Loan tenure | 3-7 years |
| Education qualification | VIII standard pass |
| Maximum Loan amount | Rs. 1 Crore |
| Subsidy | 15% to 35% |
Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE).
CGTMSE is a joint initiative launched in 2000 by the Ministry of Micro, Small and Medium Enterprises (MSME), the Government of India, and the Small Industries Development Bank of India (SIDBI). It encourages financial institutions to provide collateral-free credit schemes to micro and small enterprises. In case of any default, the bank can file a claim with CGTMSE. The following are some of its main features:
| Loan amount | Up to 5 crore |
|---|---|
| Collateral | Not required |
| Loan tenure | 5-10 years |
| Annual Guarantee fee | 0.37%-1.35% |
| Age | Minimum age of 18 |
Stand-up India
Stand-up India is a central government scheme launched in 2016. It provides bank loans for entrepreneurship among women and members of Scheduled Castes (SCs) and Scheduled Tribes (STs). Existing businesses cannot avail loans through this scheme, as these are provided for starting new businesses. These loans are provided through various banks, including scheduled commercial banks, regional rural banks (RRBs), and small finance banks.
This scheme provides loan amounts ranging from Rs. 10 lakhs to Rs. 1 crore. The interest rates and tenure vary depending on the nature of the business and other factors such as the nature of the business, credit policies of the lender, etc.
SIDBI Make in India Soft Loan Fund for Micro, Small, and Medium Enterprises (SMILE)
SMILE is a scheme launched by the central government to provide financial assistance to 25 Identified sectors under the ‘Make in India’ initiative. This scheme promotes the ‘Make in India’ initiative among entrepreneurs. SMILE provides adequate funding for the setting up of new enterprises and also for the expansion of existing ones. The following are some of its main features:
| Loan tenure | Maximum 10 years |
|---|---|
| Loan amount | From Rs.10 lakhs to Rs.25 lakhs |
| Interest rates | Depending on enterprises’ requirement |
| Nature of loan | Quasi-equity and term loans |
These are some of the loan schemes available for MSMEs in Odisha. Each scheme has its eligibility criteria, and MSMEs can choose the one that best suits their requirements. By availing of these schemes, MSMEs can meet their financial needs and contribute to the growth of the economy.
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