GST Loan: Schemes and Impact in India

The new working facility was launched by the Indian government for all MSME owners that are GST compliant. Various Indian banks have also started issuing Loans based on GST return filed by the owner.

The new initiative is a complete online procedure for the appraisal of the loan with principle approval within 60 minutes. The government under this initiative has also listed the partner banks that will provide loans.

GST Loan Facility Scheme

Companies that have registered MSME certificate can obtain a collateral free loan from the government based on their GST returns filed previously. The MSME has access to the loan amount of Rs 10 lakh to Rs. 1 crore.

The loan can only be provided based on the fact that you complete all the terms and condition prescribed by the Department of Financial Services (DFS) and the platform is directly linked to CGTMSE.

Note: It is lenders discretion to ask for collateral as per latest guidelines. 

Features of GST loan Scheme

  • Applicable for all small and medium-sized enterprises (MSME)
  • Collateral free loan that is entirely online
  • The rate of interest relevant to this loan facility is 8%
  • Can be availed in 60 minutes through GSTIN
  • There is no need to pay any registration fees or any convenience charges as well. 

Eligibility Criteria

Only for Existing Businesses

Currently, the scheme is launched exclusively for existing businesses and not for new business owners. The owners of the MSME should be IT and GST compliant and should have 6-month bank statement available.

GSTIN Holders

The applicants will have to provide their GSTIN while applying for the loan facility with a bank statement dating back to 6 months.

Loan eligibility is determined by :

  • Income Revenue
  • Existing Credit Facility
  • Repayment Capacity of the Proprietor or Company

Documents Required for Availing Loan

Applicant Details

Involving the name of the entity, GST identification number, place of business and authorised representative details and the IFSC code of your primary bank.

Checking application Status

Applicant after submitting the application with psbloansin59min will get principle approval within 59 minutes on the registered e-mail id and phone number.

Loan Application Process

  • The applicant needs to submit Identification number with PSBonline along with IT returns in XML format.
  •  Once the applicant has submitted the GSTIN and ITR, he needs to furnish further information of his bank statement of the past 6 months.
  • Directors and owners need to submit their necessary details with the department of financial services
  • Details of the directors, partners and proprietor in the form that is to be provided.

Impact of GST on Commercial Loan

Banks are providing a slew of loans boost to their credit growth, and these taxes were charged a rate of 15% service tax which will now replace 18% GST. Thus, making the loans an expensive affair for ordinary people.

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