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Micro, small, and medium-sized enterprises (MSMEs) form the backbone of India’s economy, owing to their considerable contribution to the country’s GDP, exports, and employment generation. At present, there are approximately 6.3 crore MSMEs in India, contributing to around 30% of India’s GDP and more than 40% of total exports. Moreover, MSMEs are the second-largest employer in India after the agriculture sector. To help these MSMEs grow and flourish without being affected by financial hurdles, Tata Capital offers MSME loans or SME loans at competitive interest rates.

Features of MSME Loan

Along with the affordable interest rates and easy eligibility, our business loans for startups come with the following product offerings:

  • Loan Amount

    We offer a loan amount of Rs. 1 lac to Rs. 90 lakhs as a startup business loan or MSME business loan. You can choose your startup loan amount as per your precise needs

  • Loan Tenure

    Our MSME loan/SME loan is issued for a tenure of 12 months to 60 months. It means that you have the flexibility to choose your business startup loan tenure as per your repayment capability

  • Interest Rates

    We provide loans for startups at highly affordable rate of interest, starting from just 16% per annum

  • Customized Products

    Our business loans for startups are highly customizable to suit the specific needs of startup businesses. You can set the dimensions of your MSME loan/SME loan as per your exact business requirements

  • No Collateral

    We provide MSME loan for startup businesses without asking for collateral or security. It means that you are not required to pledge your personal or business assets to avail of a startup business loan from us

  • Multiple EMI Options

    Our business loans for startups come with multiple EMI options. You have the flexibility to choose a suitable EMI plan for your MSME startup loan and structure your startup loan repayment according to your cash flow

  • Easy Eligibility

    We understand that startup business finds it difficult to get a loan for SME in India. That is why we offer MSME business loans for startups with relatively easy eligibility criteria. Our MSME loan eligibility and MSME loan process are simple and hassle-free

MSME/SME Loan EMI Calculator

Tata Capital’s online MSME/SME loan EMI calculator is a powerful tool that helps business owners quickly and accurately determine their EMI amounts. By simply entering key details into the provided fields, users can instantly view their business loan EMI and the total interest payable. This easy-to-use tool takes the guesswork out of loan management, allowing users to plan their finances effectively and make informed decisions for their business growth.

Loan amount
₹
9,000,000%1,000,000%
₹1,00,000₹90,00,000
Loan duration
1%5%3%
1 Year5 Years
Loan duration
36%
12 Months60 Months
Rate of interest
%
26%12%
12% p.a26% p.a

Monthly EMI

₹33,214*

Created with Highcharts 9.0.1Total Amount ​ Payable​₹11,95,715*​Total Amount ​ Payable​₹11,95,715*Total Interest ​ Payable​₹1,95,715*​Total Interest ​ Payable​₹1,95,715*

  • Total Amount Payable

    ₹11,95,715*

  • Total Interest Payable

    ₹1,95,715*

Total Amount Payable

₹11,95,715*

Total Interest Payable

₹1,95,715*

Apply Now
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Benefits of MSME Loan/SME Loan

As an MSME or SME owner, you can avail of an MSME loan/SME loan from Tata Capital and fulfill all your business's financial requirements. Our MSME business loan is easy to get and offers the following advantages:

Get Access to Working Capital

Adequate working capital is essential for conducting day-to-day business operations. You can use our SME business loan to meet your business’ working capital requirements. Be it paying for the inventory, clearing short-term debts, or remunerating your monthly utility bills; you can manage all short-term requirements of your business through a startup business loan.

Update Your Infrastructure

By availing of an MSME business loan, upgrading your workplace infrastructure can become an inexpensive task. Our business loans for startups are meant to provide high-value financing to small business owners at affordable interest rates.

Hire Competent Personnel

No business can thrive without efficient and competent staff. Our startup business loan can ensure that the lack of funds can never deter you from hiring the best workforce for your business. We provide startup loan for new businesses as well as established enterprises so that they can achieve greater heights.

Expand Your Business

The expansion of business may demand significant finances. But with the availability of business loans for startups, you don’t have to worry about arranging finances for your business expansion. You can simply avail of an MSME startup loan and meet all your financial requirements without any hassles.

Eligibility Criteria for MSME Loan/SME Loan

    • Age- To be eligible for our startup business loan, your age must be between 21 and 65 years

    • Business Profitability - We provide business loans for startups to those businesses which have shown consistent profits for at least the past three years

    • Business Turnover - Your business turnover must indicate an upward trend if you want to apply for our MSME loan scheme

    • Balance Sheet - The balance sheet of your business must be audited by a registered Chartered Accountant if you want to avail of our MSME loan for startup business

    • Please note that our MSME loan process may involve some other eligibility requirements as well.

Interest Rates and Charges for MSME Loan/SME Loan

Just like any other loan, business loans for startups involve certain charges and fees. These charges can be classified into three categories - General Charges, Miscellaneous Charges, and Foreclosure Charges. The details of the charges applicable on Tata Capital’s business startup loan are mentioned below:

General Charges

Below are the general charges applicable on our MSME loan/SME loan:

Type of Fee Applicable Charges

Interest Rate

Starts at 16% p.a.*

Processing Fee

Upto 4% of the loan amount

Stamp Duty

As Applicable

Penal/Additional Interest Rate

3% on Overdue amount per month
  • Interest Rate - The rate at which you’ll have to pay interest on your startup business loan is known as the interest rate. Our interest rates on business loans for startups start from 16% per annum
  • Processing Fee - We charge a one-time processing fee at the time of the MSME loan apply. This processing fee is non-refundable even if the loan doesn’t get sanctioned
  • Stamp Duty - We charge a legal fee - known as stamp duty - for the preparation of the SME business loan agreement. This fee may vary from one state to another
  • Penal Interest or Additional Interest - In the case of delayed EMI payment of your startup business loan, we will charge an additional interest over and above your existing startup loan interest rate

Miscellaneous Charges for MSME Business Loan

Below are the miscellaneous charges that would apply to your MSME loan/SME loan:

Type of Fee Applicable Charges

Prepayment / Foreclosure Charges

Foreclosure charges on Term Loan Facility:
**4.5% on the principal outstanding at the time of foreclosure + Applicable Taxes

No foreclosure is allowed in first 9 months.6.5% charges if foreclosed within 9 months

 

Foreclosure charges on Top Up:
2.25% on the principal outstanding at the time of foreclosure

Foreclosure charges shall be levied only if new rate is lower than existing rate.

 

**Foreclosure Charges in Hybrid Term Loan:
4.5% on the Dropped down limit amount + Applicable taxes

No foreclosure is allowed in first 9 months.6.5%charges if foreclosed within 9 months

Processing Charges

As Applicable

Payment Instrument swapping

 

Rs. 550/-

Dishonour Charges

Rs 600 for every Cheque/ Payment Instrument Dishonor

Mandate rejection service charges

Rs. 450/-

(Charges will be levied if new mandate form is not registered within 30 days from the date of rejection of previous mandate form by Borrower’s bank for any reasons whatsoever.)

Annual Maintenance Charges (Hybrid Term Loan)

First Year: 0.75% or 1000 whichever is higher per year will be deducted from the limit and shall be payable at the end of the 13th month


Subsequent Years: 0.50% or 1000 whichever is higher per year will be deducted from the limit and shall be payable at the end of the 13th month

Document processing charges

Rs. 1999/-

Cancellation charges

2% of the Facility amount OR

Rs. 5750/- Whichever is higher

Duplicate Repayment Schedule

Rs. 550/-

Duplicate NOC

Rs. 550/-

Statement of Account (SOA)

Customer portal – Nil

Branch walk in – Rs. 250 /-

Foreclosure Letter Charge

Customer portal – Nil

Branch walk in - Rs 199/-

Post Dated Cheque Charges Rs

Charges Rs 850

section 138 and section 25 filing

At Actual

Arbitration Filing

At Actual

Receiver Order

At Actual

Notice

At Actual

Legal Notice

At Actual

Lawyer fees

At Actual

Execution of award

At Actual

Note: 
 

  • The amounts are net of taxes such as GST, etc.
  • GST, other Government taxes and levies as applicable, will be payable on all fees and charges in above mentioned

 

  • Bounce Charges - Bounce charges or dishonor charges will be levied if your EMI gets bounced. This usually happens due to the lack of funds in your bank account
  • Mandate Rejection Service Charge - A mandate rejection service charge is levied if you reject any of the services rendered by us
  • CC Hybrid Term Loan Annual Maintenance Charge - We also provide a Cash Credit (CC) or Hybrid Term Loan on our business loans for startups. However, this facility accompanies CC Hybrid Term Loan annual maintenance charges for the maintenance of CC or Hybrid Term Loan accounts
  • Document Processing Charge - When you apply for an MSME loan, we have to process certain documents, such as loan agreement, indexing, etc. We levy a document processing charge for processing such documents
  • Outstation Collection Charge - If you’ve issued your payment cheques to a non-local branch, we’ll levy an outstation collection charge for the collection of these cheques
  • Statement of Accounts - To issue a hard copy of your Statement of Account, i.e., the list of transactions made from your bank account during a given period, we’ll collect a nominal fee. However, a soft copy is issued free of charge
  • Loan Cancellation Charges - If you wish to apply for the cancellation of your loan after its disbursal, we’ll levy loan cancellation charges
  • Payment Instrument Swapping - Swapping or exchanging your payment mode with a different financial instrument will attract payment instrument swapping charges
  • Duplicate Repayment Schedule - We will issue your original loan repayment or amortization schedule for free. However, the issuance of a duplicate repayment schedule will attract certain charges
  • Duplicate NOC - Once you’ve paid all EMIs of your business startup loan, we will send a No Objection Certificate (NOC) to your mailing address. But if you end up losing this NOC, we will issue a duplicate NOC after collecting a duplicate NOC fee
  • Post-Dated Cheque Charges - You can make your EMI payments via post-dated cheques or PDCs. However, you will be charged with PDC charges for this

Foreclosure Charges

Below are the foreclosure charges applicable on our MSME loan/SME loan:

Type of Fee Applicable Charges

Part-Prepayment/ Prepayment/Foreclosure Charges

Foreclosure charges on Term Loan Facility:

  • No Foreclosure and Part Payment is allowed in First 9 months from the date of disbursement. 6.5% charges if foreclosed/ part-prepaid within 9 months from the date of disbursement
  • 4.5% on the principal outstanding at the time of foreclosure


Part-Prepayment/ Prepayment/ Foreclosure charges on Top-up:

  • 2.25% on the principal outstanding at the time of foreclosure
  • Foreclosure charges shall be levied only if new rate is lower than existing rate.
     

Part-Prepayment/ Prepayment/ Foreclosure Charges in Hybrid Term Loan:

  • 4.5% on the Dropped down limit amount
  • No foreclosure and Part- Payment is allowed in first 9 months. 6.5%charges if foreclosed/ part-prepaid within 9 months
  • Part-Prepayment/ Prepayment/Foreclosure Charges - You can choose to foreclose your SME loan by making prepayments or part prepayments on it. However, every time you make a prepayment on your SME business loan, you will have to pay a foreclosure charge
  • Part-Prepayment/ Prepayment/Foreclosure Charges for Top-Up - You can also avail of a top-up loan on your SME loan. But if you wish to foreclose your top-up loan before the end of its tenure, you will have to pay a foreclosure charge on the top-up loan
  • Part-Prepayment/ Prepayment/Foreclosure Charges on CC Hybrid Term Loan - You can benefit from our flexible funding options, such as CC and Hybrid Term Loan limit facilities on business loans for startups. Upon the foreclosure of our CC Hybrid Term Loan account, you will be charged with a foreclosure charge on CC Hybrid Term Loan
  • Part-Prepayment/ Prepayment/Foreclosure Letter Charge - If you’ve opted to foreclose a loan, you will need a foreclosure letter from us. Although the soft copy of this letter is free, the hard copy is chargeable

Documents Required for MSME / SME Loans

Tata Capital offers a hassle-free online application process with minimal documentation. While the exact documents required can vary from case to case, here is the standard list of documents you need to submit when applying for an MSME loan-

KYC Documents

For Know Your Customer (KYC) documents, you need to submit a photo identity proof and address proof. These include a copy of your PAN Card along with a copy of your Aadhaar Card/ Voter ID/ Driving License/ Passport.

Business Proof

Documents for proof of business ownership include the Business registration certificate, Trade license, GST Registration certificate, or a certified copy of the partnership deed or sole proprietorship declaration.

Income Proof

Within income proof documents, you can submit the last two years of ITRs and computation of income, profit and loss statement for the last two years, Audited Financial with Tax Audit for the previous two years, or balance sheet.

Bank Statements

 Current bank account and GST statements for the last six months.

Please note that this business loan documents list is indicative. The exact documents required for business loan may vary from case to case based on our assessment program. However, the KYC documents and six-month bank statements are common business loan documents required in each case.

How to Apply for an MSME Loan?

 

Several lenders provide loan for SME in India. With Tata Capital, the MSME loan apply process is simple and hassle-free. You can do it in any of the following ways:

  • Branch

    You can physically visit your nearest Tata Capital branch and get in touch with our representative to apply for an MSME loan

    Locate a Branch

How to Calculate MSME /SME Loans EMI?

Principal Loan Amount

The “principal loan amount” is the most crucial factor that determines your SME loan EMIs. It refers to the amount you have borrowed from a lender to fulfill the working capital requirements of your business. If you borrow a high loan amount, your SME loan EMIs will also increase since you will have to repay a significantly larger sum. Thus, it’s crucial to assess your financial requirements carefully and apply for the right loan amount.

Loan Tenure

Another factor that plays a major role in determining your MSME loan EMI is the “loan tenure”. It refers to the period or duration for which you have taken a business loan. If you want to spread your SME loan repayment into smaller EMIs, you can opt for a longer loan tenure. However, doing so would increase your overall interest outgo. On the flip side, if you can afford to pay larger EMIs and want to reduce your borrowing costs, you can opt for a shorter loan tenure.

Rate of Interest

The third factor that determines your SME loan EMI is the applicable rate of interest. Your MSME loan interest rate is decided by the lender at the time of loan approval. A higher interest rate results in larger EMIs since the total interest amount you need to pay to the lender increases. You can secure the lowest MSME loan interest rate based on your credit score, age, business experience, and a sound business plan for the future.

Once you know these MSME loan details, you can calculate your loan EMI through a mathematical formula mentioned below:

E = P x R x (1+R) ^ N / [(1+R) ^ N – 1]

Here, ‘E’ is your SME Loan EMI, ‘P’ is the Principal Loan Amount, ‘R’ is the applicable Rate of Interest on a monthly basis, and ‘N’ is the Loan Tenure in months.

If you don’t want to go through complex mathematical calculations, you can use our online business loan EMI calculator to determine your SME loan EMIs. All you have to do is enter your loan amount, loan duration, and the applicable rate of interest in this calculator, and it will display your monthly EMI within a few seconds.

Do's and Don'ts when Applying for an MSME Loan Online

While Tata Capital offers simple eligibility criteria and an easy online application process to obtain an MSME loan, borrowers must consider a few steps to ensure quick loan approval without any hassles.

 

Do's Don'ts

Assess the Loan Amount: Determine your loan requirements based on the business plan, growth potential, and the timeline for revenue generation. This will help you ensure no overestimation of the loan amount when applying.

Multiple Applications: Avoid applying for an MSME loan with multiple lenders, as it can seriously impact your credit score. A poor credit score can further affect your chances of loan approval or fetch higher interest rates, which can be damaging to your business growth.

Keep Documentation Handy: Make a list of documents required for the loan process and keep them handy when applying to ensure smooth and hassle-free loan approval.

Fine Print: While Tata Capital offers favourable and transparent loan terms, it is important for the borrower to read the fine print carefully to understand the terms, especially those related to interest rates and additional charges.

Check Credit Score: Most lenders have set credit score criteria to verify your eligibility for the loan. Make sure to check the lender's credit score requirements before applying.

Repayment Schedule: Not adhering to the repayment schedule can severely affect your credit score and add to your financial burden with outstanding EMIs and penalty charges.

Business Plan: Make sure to keep handy the details of how you plan to use the funds during the MSME loan application to ensure seamless approval.

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