Government Loan Schemes in India 2025
Government Loan Schemes in India 2025 provide subsidized financing to individuals, entrepreneurs, and MSMEs to promote economic growth and self-reliance. LoanPao partners with over 500 RBI-compliant banks and NBFCs to help you access schemes like Pradhan Mantri Mudra Yojana (PMMY), Stand-Up India, and Prime Minister’s Employment Generation Programme (PMEGP) with ease.
What are Government Loan Schemes?
These are financial assistance programs launched by the Government of India to support startups, small businesses, women entrepreneurs, and marginalized communities. They offer low-interest loans, collateral-free options, and subsidies through banks and NBFCs, making financing accessible for diverse needs like business expansion, skill development, or employment generation.
Benefits of Government Loan Schemes
These schemes offer significant advantages:
- Low Interest Rates: Subsidized rates starting from 7% p.a.
- Collateral-Free Loans: Many schemes don’t require security for small loans.
- Subsidies: Margin money or interest subsidies for eligible borrowers.
- Inclusive Access: Prioritizes women, SC/ST, and rural entrepreneurs.
- Flexible Repayment: Tenures up to 7 years with moratorium periods.
Key Government Loan Schemes in 2025
Here are some prominent schemes available through LoanPao’s partner lenders:
| Scheme | Purpose | Loan Amount | Interest Rate (p.a.) |
|---|---|---|---|
| Pradhan Mantri Mudra Yojana (PMMY) | Micro-enterprise funding | Up to ₹10 lakh | 7-12% |
| Stand-Up India | Loans for SC/ST/Women entrepreneurs | ₹10 lakh to ₹1 crore | 10-13% |
| Prime Minister’s Employment Generation Programme (PMEGP) | Employment generation through MSMEs | Up to ₹50 lakh | 8-12% |
| Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) | Collateral-free MSME loans | Up to ₹5 crore | 9-14% |
| Pradhan Mantri Awas Yojana (PMAY) - Credit Linked Subsidy Scheme | Subsidized home loans | Up to ₹18 lakh | 6.5-9% |
Eligibility Criteria
Eligibility varies by scheme but generally includes:
| Criteria | Requirement |
|---|---|
| Applicant Age | 18-65 years (varies by scheme) |
| Business Type | Micro/small enterprises, startups, or individuals (per scheme) |
| Special Categories | SC/ST, women, rural entrepreneurs prioritized in some schemes |
| Documents | KYC, business plan, project report, caste certificate (if applicable), ITR (if required) |
| Credit Score | Not mandatory for most schemes; 600+ preferred |
Detailed Overview of Top Schemes
Pradhan Mantri Mudra Yojana (PMMY)
Offers loans under Shishu (up to ₹50,000), Kishore (₹50,000-₹5 lakh), and Tarun (₹5 lakh-₹10 lakh) categories for micro-enterprises. No collateral required.
Stand-Up India
Provides loans for SC/ST and women entrepreneurs to start greenfield enterprises in manufacturing, services, or trading. Loan range: ₹10 lakh to ₹1 crore.
Prime Minister’s Employment Generation Programme (PMEGP)
Subsidized loans for setting up MSMEs, with up to 35% subsidy in rural areas. Loan limit: ₹50 lakh for manufacturing, ₹20 lakh for services.
Pradhan Mantri Awas Yojana (PMAY)
Offers interest subsidies on home loans for EWS/LIG/MIG categories, with subsidies up to ₹2.67 lakh for eligible borrowers.
How to Apply for Government Loan Schemes with LoanPao
Follow these steps to access government-backed loans:
- Explore Schemes: Review schemes like PMMY, Stand-Up India, or PMEGP on LoanPao’s platform.
- Check Eligibility: Verify your eligibility based on scheme-specific criteria.
- Apply Online: Fill out the application form and select the desired scheme.
- Submit Documents: Upload KYC, business plan, project report, and other required documents.
- Loan Processing: Our partner lenders process applications within 7-15 days.
- Disbursal: Receive funds upon approval, with subsidies applied as per scheme norms.
Why Choose LoanPao for Government Loan Schemes?
LoanPao simplifies access to government-backed financing:
Trusted Lenders
Connect with 500+ RBI-compliant banks and NBFCs.
EMI Calculator
Plan repayments with our EMI calculator.
Expert Guidance
Get support to navigate scheme-specific requirements.