MSME stands for micro, small and medium enterprises, sometimes it is also shortened to SME for small and medium enterprises. But, in essence, MSME and SME loans are the same and are offered to businesses that fall under these two categories. Mostly, these loans are given to startup owners, small business owners, and women entrepreneurs on a short-term basis. The duration of MSME / SME loans varies from lender to lender. As MSME loans are unsecured MSME / SME Loans, there are some minimum eligibility requirements in order to reduce the risk for lenders.
At Professional Utilities, we help business setups to source the right kind of loan suited for them. To run your business free from legal and taxation issues and for smooth passage of loans, know here what all you need to apply for:
Features of Professional Utilities MSME / SME Loans from Professional Utilities
Professional Utilities has special MSME loans and SME loans for businesses looking for quick finance in India. These loans are approved through an online process which helps in speeding up the financial vehicle delivery. Professional Utilities also allows several customisations to its financial products which makes them ideal for today’s competitive business environments.
1. Ticket Value up to ₹ 2 Crore
We have a flexible ticket size for MSME and SME Loans that starts at ₹ 50,000 and goes all the way up to ₹ 2 Crore. This makes Professional Utilities business loans a veritable option for micro, small and medium enterprises.
2. Apply for MSME / SME Loan Online
We believe in fast track growth and therefore, we removed every process that slows down a loan approval. By taking MSME and SME loans online we have ensured same-day loan approvals with disbursals pending the verification of documents.
3. MSME / SME Loan in 3 Days
Online document submission also allows us to complete the verification process quickly. As there are no wait times between sending and receiving of documents, we are able to approve MSME / SME loan disbursals within 3 days of application.
4. MSME / SME Loans without Collateral
All business loans approved by Professional Utilities are unsecured. Meaning, there is no requirement for collateral to get an MSME or SME loan from us. And so, no need to worry about asset security when getting a business loan.
5. Best Interest Rates for MSME / SME Loans
We use financial data analytics to calculate the best available interest rates for your enterprise. There is no manual intervention in the whole process and hence the rate you get is fair and as per your business’s ability to repay the MSME / SME Loan.
6. Flexible Repayment Tenure
Professional Utilities’s MSME loans give you ample time and options to repay your business loan easily. Our loan tenures start at 1 month and go all the way up to 36 months. Additionally, you have the option to repay in monthly or bi-weekly installments or EMIs. This allows you to repay your debt in sync with your account’s receivables.
7. No Hidden Costs
Professional Utilities MSME loans do not have any hidden costs or fees. We only charge an upfront processing fee of 1-2% depending on your loan amount and that’s all. This allows you to get more value in your principal disbursal than with any other business loan product in the market.
8. Zero Prepayment Charges
All MSME and SME loans from Professional Utilities come with zero prepayment fees. So, if you decide to settle your debt early, you can do so any time after the payment of the first EMI, without attracting any penalties or charges for early repayment in full.
Benefits of MSME / SME Loans by Professional Utilities
MSME / SME Loans by Professional Utilities help your business’s growth potential and opportunity exploitation ability. Here are the benefits of an MSME / SME loan from an NBFC like Professional Utilities.
– Move quickly from planning to execution
Our superfast turnaround time means that you can take things from planning to execution within a matter of days instead of weeks or months. An MSME loan from Professional Utilities allows you to get ahead in product marketing, boost production and expand your supply network in no time at all.
– Remain in control of your business
Our MSME / SME loans are unsecured, keeping your valuable assets protected in case there is a loan default. Similarly, we do not take control of your credit policy in return for investment, so that you remain in charge of your precious enterprise at all times.
– Manage your company capital better
Our MSME / SME loans can be used for a number of purposes. You can either use them to expand your operations by buying plant and machinery or opening at a new location, or you can use the loan for streamlining your working capital and general cash flow. Our MSME / SME loans help you in balancing your company capital through short-term investments that can be easily repaid.
– Raise your credibility in the market
With Professional Utilities MSME / SME loans, you can give your business a much-needed boost and hence improve your profitability. This, in turn, will reflect in your books and create goodwill and credibility for your business in the market. Credit rating agencies will also take note of your improving prospects and raise your business’s credit rating accordingly, opening the way to increased investment and business finance.
| Customized Interest Rates | 15 to 27% * |
| Processing Fees | 1-2% |
| Loan Tenure | up to 3 years |
| Pre-closure Charges | Nil** |
| Eligibility Criteria | > ₹ 90,000 turn over for 3 Months |
| Loan Amount | ₹ 50,000 – ₹ 2 crore |
| Installments | Flexible Monthly / Bi-weekly |
*Based on the health of your business, revenues and annual turnover
**Pre-closures are only allowed after the first EMI is paid in full
Eligibility Criteria for MSME / SME Loans
Professional Utilities has kept the eligibility requirements to the bare essentials in order to process MSME / SME loans faster. We do not require too many documents or unnecessary paperwork that can hold up the loan approval process.
- An established business that has been in operations for more than 6 months.
- A minimum turnover of ₹ 90,000 or more in the 3 months preceding your loan application.
- The business should not fall under the blacklisted/excluded list for SBA finance.
- The physical location of your enterprises should not be in the negative location list.
Trusts, NGOs and charitable institutions are not eligible for small business loans.
Documents Required for a MSME / SME Loans
| Proprietorship | Partnership | Pvt. Ltd./LLP/One Person Company | |
| Bank Statement (12 months) | Yes | Yes | Yes |
| Business Registration Proof | Yes | Yes | Yes |
| Proprietor(s) Pan Card Copy | Yes | Yes | Yes |
| Proprietor(s) Aadhaar Copy | Yes | Yes | Yes |
| Partnership Deed Copy | No | Yes | No |
| Company PAN Card Copy | No | No | Yes |
We accept any of the following as a Business registration proof
- Business Registration Certificate
- GST filing
- Gumastadhara
- Trade License
- Drug License
- TIN
- VAT registration
3 simple steps to your MSME / SME Loans
1. Submit Application
Simply enter your personal, business and financial info to receive a MSME / SME Loans offer.
2. Upload Documents
Upload digital copies of your documents in a single step process for verification.
3. Get Sanctioned
Receive your MSME / SME Loans approval and disbursal within 3 working days.
Smart ways to use MSME / SME loans
The micro, small and medium enterprises (MSME) sector is one of the biggest providers of employment and industrial output in the country. As much as 45% of industrial production and 40% of India’s exports comes from the MSME sector. Hence, the need for business finance is also greater in this sector. Lack of timely finance is one of the biggest bottlenecks for MSME growth in India. However, things are changing with non-banking financial companies like Professional Utilities emerging as an alternative to traditional banks. Today, MSME / SMEs can avail quick business finance up to ₹ 1 Crore within 3 days from Professional Utilities.
Here are 5 smart ways you can utilise the funds of an MSME / SME loan.
1. Inventory Management
Inventory management is a critical part of a small business as its profits depend on the sale volumes. As many as 31% of the businesses applying for a small business loan use the funds to purchase inventory. Utilise the funds from your MSME loan to secure your inventory supply chain. Manage seasonal dips, replenish existing stock or buy new product samples for sale with an inventory loan for MSMEs.
2. Purchasing Plant & Machinery
A small business owner can use unsecured MSME loans to fund the purchase of new equipment. Since, investment in plant and machinery requires heavy funding, an MSME loan up to ₹ 1 Crore can be helpful in expanding your operations without straining the company capital fund.
3. Working Capital Management
A small business owner can use unsecured MSME loans to fund the purchase of new equipment. Since, investment in plant and machinery requires heavy funding, an MSME loan up to ₹ 1 Crore can be helpful in expanding your operations without straining the company capital fun.
4. Consolidate your business debt
One of the best advantages of short-term MSME loans is that they allow you to consolidate smaller debts and make them a single EMI. This not only reduces the strain on your monthly budget but also helps in aligning your debt repayment with your invoicing schedule. Moreover, by consolidating business debt, you may be able to reduce the amount that you are currently paying for sundry debts as now you have the option to expand the repayment schedule up to 12 months.
5. Invest in Marketing
Marketing helps in growing your business by expanding its outreach. There are two things that can be accomplished with an effective marketing strategy. One, reinforcing the trust and loyalty of existing customers in your brand. Two, acquiring new customers in existing or new markets. However, marketing is a costly affair and a comprehensive online and offline marketing campaign requires investment. An MSME / SME loan fund can give you the financial backing for running such a campaign.
Calculating an MSME / SME Loan EMI
MSME / SME Loans EMI
Equated Monthly Instalments (EMIs) break down a loan into easily repayable financial units. Each unit contains a component of the principal amount and the accrued interest. Flexible EMI schedules offered by lenders like Professional Utilities Finance help you in one of the two ways. Either you can repay your loan with ease by breaking it down in small monthly instalments. Or, you can speed up the repayment of your financial debt by opting for bi-weekly instalments, halving the repayment cycle. You can also avail refinance for the previously approved loan amount with Professional Utilities’s auto-renewal option.
How to Calculate MSME / SME Loans EMI?
The MSME / SME Loans EMI calculation is done on the basis of a simple formula i.e. E = P x r x (1+r)n/(1+r)n-1 Here, ‘E’ is the EMI ‘P’ represents the loan amount ‘r’ stands for the interest rate offered on a monthly basis ‘n’ is the duration of the loan Our MSME / SME loan EMI calculator is a digital version of this formula, that allows you to calculate EMI amount through a web interface. The loan EMI calculator can help you understand the breakdown of interest and principal loan amount, thus, allowing you to decide the layout of your cash resource planning.
What to do and not to do when applying for an MSME loan online
Since the lending market operates on caution and precaution, here are some of the things that you should do and not do when applying for an MSME loan. These steps can help in improving the probability of getting a loan for your business and reduce the risk of rejection.
Do’s
- Check your credit score before moving an application for MSME or SME loan. Most lenders rely on credit rating for preliminary loan approvals.
2. Get your documentation in order before starting the loan application process. For Professional Utilities MSME loans, make sure that you have all the required documents in digital format as we do not accept physical copies at the time of application.
3. Prepare a business plan that specifies how you intend to use the loan funds and how much time it might take to generate positive returns from the investment. Every lender may not ask for it but it is good to have a business plan ready to assuage a lender’s concerns.
4. Assess your MSME loan requirements before applying. Try not to overestimate or underestimate your loan requirements as in both cases you will end up wasting time and money.
Don’t’s
- Do not apply with multiple lenders as it will reduce your credit score by several points. It also shows financial desperation on your part, which might put off potential lenders.
2. Do not delay your repayments for existing debts even if you are taking the MSME loan for debt consolidation. It has a negative impact on your credit score and financial goodwill.
3. Do not go for lenders who charge you an upfront fee. There are many fraudulent lenders in the online space who may ask for huge fees for approving your MSME loan application. A genuine lender like Professional Utilities Finance will never ask you for an upfront fee and only charges a percentage upon disbursal of the loan.