How to Get ₹3 Lakh Loan for Small Startups in India subsidy for womens
Starting a small business in India requires initial investment. Many entrepreneurs, especially first-time business owners, struggle to arrange funds. To support them, both the Government of India and public/private sector banks provide various schemes and loan facilities. Among these, loans of up to ₹3 lakh are highly popular for small-scale startups such as shops, food businesses, small manufacturing units, dairy farming, or service-based enterprises.
This article gives a complete guide on how to get ₹3 lakh loan for small startups in India, including government schemes, MSME loans, eligibility criteria, benefits, repayment, and application process.
Why ₹3 Lakh Loan is Ideal for Startups
- Most micro-businesses require small working capital, not huge investments.
- ₹3 lakh loan is sufficient for equipment, rent deposit, raw materials, or initial marketing.
- It falls under the micro-loan category, which means easy approval, fewer documents, and government support.
- Small business owners in villages, towns, and cities can apply.
Sources of Startup Loans in India
There are multiple ways to get a ₹3 lakh loan for startups:
- Government Schemes (PM Mudra Yojana, Stand-Up India, PMEGP, etc.)
- Banks and NBFCs (State Bank of India, HDFC, ICICI, Canara Bank, Axis Bank)
- Microfinance Institutions (MFIs)
- Cooperative Banks and Regional Rural Banks (RRBs)
- Self-Help Group (SHG) linkages
Major Government Schemes for ₹3 Lakh Startup Loans
PM Mudra Yojana (Pradhan Mantri Mudra Loan)
- Offers loans up to ₹10 lakh for small businesses.
- For startups, the Shishu and Kishor category is useful.
- You can easily apply for ₹50,000 to ₹3 lakh under Kishor loan.
- Interest rate depends on bank (around 8%–12%).
- No collateral required.
Eligibility
- Non-farm businesses in manufacturing, trading, and services.
- Age: 18 to 65 years.
- Aadhaar, PAN, business plan required.
PMEGP (Prime Minister’s Employment Generation Programme)
- Provides loans with subsidy up to 35% for new businesses.
- You can apply for loans up to ₹25 lakh (manufacturing) or ₹10 lakh (service sector).
- ₹3 lakh loan is easily available under this scheme.
Subsidy Support
- General Category: 15% to 25% subsidy.
- SC/ST/Women/Minorities/NER: 25% to 35% subsidy.
Stand-Up India Scheme
- Designed for SC/ST and Women entrepreneurs.
- Loan between ₹10 lakh to ₹1 crore.
- For very small startups, banks may allow lower amounts like ₹3 lakh if project is viable.
CGTMSE (Credit Guarantee Fund Trust for Micro and Small Enterprises)
- Helps entrepreneurs get collateral-free loans.
- Banks provide loans, and CGTMSE guarantees repayment.
- Startups with no assets can get up to ₹3 lakh easily.
State Government Startup Schemes
Each state has special programs:
- Telangana – T-IDEA & T-SEED funding
- Andhra Pradesh – YSR Cheyutha & AP Startup Fund
- Karnataka – Elevate Startup Scheme
- Tamil Nadu – New Entrepreneur and Enterprise Development Scheme (NEEDS)
- Maharashtra – Annasaheb Patil Arthik Magasghati Yojana
These programs provide both subsidies and loans.
Bank Loans for ₹3 Lakh Startups
Almost every major bank in India provides small business loans.
| Bank | Loan Type | Loan Amount | Key Features |
|---|---|---|---|
| SBI | SME/MSME Loans | ₹50,000 – ₹25 lakh | Low interest, wide reach |
| Canara Bank | MSME Credit | ₹1 lakh – ₹5 lakh | Collateral-free |
| HDFC Bank | Business Loan | ₹50,000 – ₹40 lakh | Fast digital approval |
| ICICI Bank | InstaBiz Loan | ₹50,000 – ₹25 lakh | Minimal documents |
| Bank of Baroda | Mudra / MSME Loans | Up to ₹10 lakh | Subsidy support |
Eligibility for Startup Loans
- Age between 18 and 65 years.
- Must be an Indian citizen.
- Valid Aadhaar, PAN, and bank account.
- Business plan showing use of funds.
- CIBIL score preferably above 650 (not compulsory for Mudra).
- For women/SC/ST, extra relaxation available.
Documents Required
- Aadhaar Card
- PAN Card
- Passport-size photographs
- Business plan / Project report
- Bank statement (last 6 months)
- Proof of business address (shop agreement, rental proof)
- Income proof if available
How to Apply for a ₹3 Lakh Startup Loan
- Visit nearest bank branch (SBI, Canara, Bank of Baroda, etc.)
- Ask for Mudra Loan / MSME Loan / Startup Loan form.
- Fill application form with details of business.
- Attach documents like Aadhaar, PAN, bank passbook, rental proof.
- Submit a basic business plan (type of business, expected earnings).
- Bank verifies and approves.
- Loan sanctioned directly to bank account.
Interest Rates and Repayment
- Government schemes: 8% – 12% per annum
- Private banks/NBFCs: 12% – 20% per annum
- Repayment period: 3 to 7 years
- Moratorium: In some schemes, repayment starts after 6–12 months.
Subsidies and Benefits
- Under PMEGP and state schemes, subsidy up to 35%.
- Women entrepreneurs get special interest rebate.
- No collateral for loans up to ₹10 lakh under CGTMSE.
- Flexible repayment for small traders.
Best Businesses to Start with ₹3 Lakh
- Grocery shop
- Dairy farm with 2–3 cows
- Tiffin/food service
- Mobile repair or computer shop
- Tailoring or boutique
- Printing and photocopy shop
- Poultry farming
- Salon or beauty parlour
- Small trading business
Mistakes to Avoid
- Submitting incomplete documents
- Not preparing a proper business plan
- Applying without checking CIBIL score (for private banks)
- Taking loan from multiple places at once
- Delaying EMI payment – leads to penalty
Benefits of Startup Loans
- Encourages self-employment
- Reduces unemployment
- Easy access for rural entrepreneurs
- Promotes women empowerment
- Boosts local economy
- Access to government subsidies and insurance cover
Comparison of Popular Schemes for ₹3 Lakh Loan
| Scheme | Loan Amount | Subsidy | Collateral | Target Group |
|---|---|---|---|---|
| PM Mudra Yojana | Up to ₹10 lakh | No subsidy | No | Small traders, service providers |
| PMEGP | ₹10 – ₹25 lakh | 15%–35% | No | Rural and urban entrepreneurs |
| Stand-Up India | ₹10 lakh – ₹1 crore | Nil | No | Women, SC/ST |
| CGTMSE | Up to ₹10 lakh | Nil | No | Micro businesses |
| State Govt Schemes | ₹1 lakh – ₹10 lakh | 25%–40% | No | Varies by state |
Future Scope of Startup Financing
- Government expanding digital lending through Jan Dhan–Aadhaar–Mobile (JAM) system.
- More collateral-free loans will be introduced.
- Special focus on green businesses, women-led startups, rural innovation.
| Scheme | Apply Link |
|---|---|
| Mudra Loan | mudra.org.in |
| Stand-Up India | standupmitra.in |
| PMEGP | kviconline.gov.in/pmegpeportal |
| CGTMSE | cgtmse.in |
| SIDBI | sidbi.in |
| Udyam MSME | udyamregistration.gov.in |
| SC/ST Hub | scsthub.in |
| Agri Infra Fund | agriinfra.dac.gov.in |
Getting a ₹3 lakh loan for startups in India is now simple, thanks to schemes like PM Mudra Yojana, PMEGP, CGTMSE, and bank MSME loans. With minimal documents, no collateral, and government subsidy, small entrepreneurs can start their dream businesses.
Applicants should prepare a clear business plan, maintain financial discipline, and use official government portals or trusted banks to apply. With proper guidance, even a first-time entrepreneur can build a sustainable business with ₹3 lakh support.