Starting a business requires not just passion and a good idea, but also sufficient funds to bring the plan to life. Many aspiring entrepreneurs in India face a common challenge – arranging the initial capital. A business loan can be a reliable option to meet this requirement. If you are looking to raise ₹10 lakh for your business, here’s everything you need to know about where and how to get it.
Why Take a Business Loan?
A business loan helps you:
Arrange working capital for day-to-day operations.
Purchase machinery, equipment, or raw materials.
Expand your shop, office, or factory.
Manage cash flow during seasonal fluctuations.
Launch new products or services.
Instead of using personal savings, a business loan allows you to maintain liquidity while still growing your enterprise.
Where to Get a ₹10 Lakh Business Loan in India
- Banks Offering Business Loans
Several public and private sector banks provide business loans with competitive interest rates and flexible repayment options.
State Bank of India (SBI) – Offers business loans under the SME Loan Scheme and SME Smart Score.
HDFC Bank – Provides collateral-free business loans up to ₹40 lakh with fast approvals.
ICICI Bank – Offers business loans up to ₹2 crore with flexible tenure.
Axis Bank – Provides unsecured business loans up to ₹50 lakh.
Punjab National Bank (PNB) – Offers MSME loans under various government schemes.
Bank of Baroda – Provides SME loans and working capital finance.
Eligibility: A minimum of 2-3 years of business stability, good credit history, and ITR filings.
Interest Rate: Usually between 10% – 20% per annum.
Loan Tenure: 1 to 5 years.
- NBFCs Offering Business Loans
NBFCs are a great alternative to banks because of their quick processing and minimal paperwork.
Bajaj Finserv – Provides unsecured business loans up to ₹50 lakh with flexible repayment.
Tata Capital – Offers loans up to ₹75 lakh for small and medium businesses.
Lendingkart – Specializes in small business loans with fast online approvals.
Fullerton India – Provides business loans up to ₹50 lakh for SMEs.
IIFL Finance – Offers SME loans and working capital loans with simple documentation.
Benefit: Faster disbursal compared to banks.
Limitation: Interest rates may be slightly higher.
- Government Schemes for Business Loans
If you are starting a small or medium enterprise (SME), several government-backed schemes can help:
MUDRA Loan under PMMY (Pradhan Mantri Mudra Yojana):
Available up to ₹10 lakh under the “Tarun” category.
Best for small traders, manufacturers, service providers, and entrepreneurs.
Stand-Up India Scheme:
Provides loans between ₹10 lakh and ₹1 crore.
Focused on SC/ST and women entrepreneurs.
CGTMSE (Credit Guarantee Fund Trust for Micro and Small Enterprises):
Collateral-free loans up to ₹2 crore for MSMEs.
- Microfinance Institutions (MFIs)
For small business owners, especially in rural and semi-urban areas, MFIs provide easy access to funds. These institutions are ideal for traders, artisans, and self-employed individuals who may not qualify for a bank loan.
- Startup Funding Platforms
If you are a new-age startup with innovative ideas, you can also explore venture capital firms, angel investors, or crowdfunding platforms. Though this is not a loan in the traditional sense, it can help raise funds without heavy interest burdens.
Documents Required for a Business Loan of ₹10 Lakh
Most lenders require:
KYC documents (Aadhaar, PAN, etc.)
Proof of business existence (GST certificate, registration)
Income tax returns of the last 2-3 years
Bank statements
Financial statements (Balance sheet, P&L account)
Collateral (if applicable, for secured loans)
Tips to Increase Your Loan Approval Chances
- Maintain a good CIBIL score (above 700 is preferred).
- Keep financial records and tax returns updated.
- Show a clear business plan to lenders.
- Avoid multiple loan applications at the same time.
- Choose lenders offering collateral-free options if you lack security.
Conclusion
Getting a business loan of ₹10 lakh in India is achievable if you prepare well and choose the right source of funding. Banks like SBI, HDFC, ICICI, Axis, and PNB offer reliable loan products, while NBFCs such as Bajaj Finserv, Tata Capital, Lendingkart, and Fullerton India provide faster approvals. You can also explore government schemes like MUDRA or Stand-Up India for collateral-free support. Always compare interest rates, loan terms, and repayment flexibility before applying. With the right funding, your business idea can turn into a profitable venture.
