Bank Credit Facilitation Scheme

In order to meet the credit requirements of various small and medium-sized industries, the National Small Industries Corporation (NSIC) has signed a memorandum of understanding with various national and private banks in India. This joint agreement is known as the Bank Credit Facilitation Scheme and aims to provide various MSMEs with the credit support that they need from national or private banks. The NSIC essentially assists the MSMEs in the documentation and filing process while submitting proposals to banks and other related activities. Under the Bank Credit Facilitation Scheme, all these facilities are provided free of cost to small and medium-sized industries.

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Micro, small and medium-sized business enterprises (MSMEs) are defined by the number of personnel that they employ. As the name suggests, these business enterprises are limited in size and throughout the world, outnumber large business enterprises by a big margin. The MSME sector in India is the largest after China and is engaged in the manufacturing of nearly 6000 products of various types.

Today, MSMEs operate in a variety of sectors such as telecommunications, healthcare, and electronics and are said to be a major force in India’s growing economy. In order to help these MSMEs grow at a rapid scale government along with many financial institutions have come up with several business loan schemes so that these small-scale businesses do not fall short of funds. Bank Credit Facilitation Scheme was initiated by the National Small Industries Corporation in collaboration with various national and private banks in India to encourage the MSME sector.

Also Read: What is the MSME Loan for New Business in India

Any micro, small or medium enterprise that has been registered already is eligible for the Bank Credit Facilitation Scheme. The documents to be submitted vary based on the purpose of the loan. The general documents as required are:

1. Identity proof such as a voter id card, passport, or driving license
2. Proof of residence such as a passport, driving license, or even utility bills such as electricity or telephone
3. Proof of address for your business
4. Details of the assets of promoters, directors, and guarantors. You will also need to furnish a liability statement along with the most recent records of income tax returns
5. A copy of the rent agreement or certificate of the lease if the physical premises for your business enterprise have been taken on rent or lease
6. You will also need to provide a copy of the SSI registration certificate and a memorandum of the entrepreneur
7. A complete profile of your business enterprise should also be provided that should include the nature of the business activity, the address of the activity, the name and address of the promoters, the experience of the company, and shareholding patterns
8. A balance sheet complete with statements of IT/ST returns from the past 2 years
9. A projected balance sheet of the upcoming 2 years
10. A duly filled application form
11. A copy of the Credit Monitoring Arrangement (CMA)
12. Records of existing bank account
13. A project report for the term loan requirements
14. Estimates, quotations and sanctioned building plans
15. Deeds of partnership, trust, rules and bye-laws, memorandums, articles of association and a certificate of incorporation
16. A certificate of clearance from the pollution control board and a sanction from the electricity board and other statutory authorities
17. Month-wise records of data and sales of the current financial year, the value of stocks, finished goods and records of debts and credits

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To apply for a Bank Credit Facilitation Scheme you simply need to download the application form from the official website of the NSIC , where you can fill in all the required details and submit the form to a delegated officer. The kinds of loans that are available for MSMEs are:

Also Read: What is the procedure to obtain an MSME certificate?

The Bank Credit Facilitation Scheme offers the following salient benefits:

1. Easily available credit for MSMEs
2. Ensuring assistance to MSMEs for filing and documentation for loan schemes
3. Assisting MSMEs to get good interest rates
4. Helping MSMEs to get financed from banks
5. Facilitating credit availability for all kinds of MSMEs

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