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Smile Personal Loan Online Registration

 As the name suggests smile loan is scheme to help MSMEs  to take part in the Government of India ‘Make in India’ campaign. The main purpose of this loan is to focus on 25 sectors under ‘Make in India’ programme with focus on financing enterprises under MSMEs sector.
The main objective under this scheme is to provide soft loan at concessional rates to MSME sector to grow.
Small Industrial Development Bank Of India(SIDBI) is nodal agency for processing SMILE loans.

Target enterprises under SMILE Loan

Under SMILE loan Government of India has identified 25 target sectors:-

  • Automobiles and Automobile Components
  • Aviation
  • Bio-Technology and Chemicals
  • Constructions
  • It and BPM
  • Electrical Machinery and Electronic Systems
  • Defense Manufacturing
  • Food Processing
  • Leather and Mining
  • Media & Entertainment
  • Oil & Gas
  • Pharmaceuticals
  • Railways
  • Ports & Shipping
  • Renewable Energy
  • Roads & Highways
  • Space and Thermal Power
  • Textiles & Garments
  • Tourism & Hospitality
  • Wellness Sectors

Objective

The objective of the Scheme is to provide soft loan, in the nature of quasi-equity and term loan on relatively soft terms to MSMEs to meet the required debt-equity ratio for establishment of an MSME as also for pursuing opportunities for growth for existing MSMEs.

Eligibility

  • All MSMEs as per MSMED Act 2006.
  • Emphasis on financing smaller enterprises within MSMEs and also new enterprises in manufacturing as well as service sectors
  • Existing enterprises undertaking expansion/modernization/ technology up-gradation / other projects for growing their business
  • Loans extended under the scheme cannot be used for repayment of earlier loans.

Types of Assistance

Soft Loan

In the Nature of Quasi

Equity

Amount of Funding

  • 10% of the project cost subject to maximum Rs.20 lakh
  • 15% of the project cost subject to maximum Rs.30 lakh for enterprises promoted by SC / ST / Persons with disability / Women (controlling stake of at least 51%)
  • Term Loan – On Relatively Soft Terms

Upfront Fee

  • 0.50% of the loan amount

Rate of Interest

  • First 3 years: 9.15% to 9.35% p.a. (fixed)
  • From 4th year onwards: 11.70% – 12.70% p.a.  – Based on Bank’s PLR / Internal Rating (rate can be both fixed and floating)

Repayment Period

  • Up-to 10 years inclusive of moratorium up-to 3 years.

Term Loan – On Relatively Soft Terms

Amount

  • Minimum Rs.50 lakh for new enterprises
  • Minimum Rs.25 lakh for existing enterprises

Rate of Interest

  • First 3 years: 9.45% to 9.95% p.a. (fixed) – Based on Rating
  • From 4th year onwards: 11.70% – 12.70% p.a. – Based on Bank’s PLR / Internal Rating

Term Loan

  • 75% of Project Cost up-to Rs.100 lakh, and
  • 2/3rd for the rest subject to promoters contribution and DER norms.

Security

  • First charge over all assets created under the project
  • Personal guarantee of the Promoter(s)
  • Fixed Asset Coverage of at least 1.40 times including collateral security

Repayment Period

Up to 10 years inclusive of moratorium up-to 3 years.

Fiscal Incentives

  • For the general category, 10% of the project cost, subject to a maximum of INR 20 Lakh is provided as the loan amount
  • 15% for the enterprises promoted by Scheduled Caste (SC) /Scheduled Tribe (ST) / Persons with Disabilities (PwD), and women, subject to a maximum of INR 30 Lakh
  • Persons belonging to these categories must own a controlling stake (ie 51% or higher)