FM Arun JaitelyLaunched Web Portal to Grant Rs.1.00 Crore Loan to MSME Within just 59 Minutes

Banking National News

With an aim to boost the credit availability to Micro, Small and Medium Enterprises (MSMEs), Finance Minister Arun Jaitely on September 25, 2018 launched a new web portal through which MSMEs would be benefitted with fast track loan facility. Web portal address is This web portal will enable in-principle approval for MSME Loans up to Rs. 1 crore within 59 Minutes with entrepreneurs need not to visit the branch.This portal is set up by Small Industries Development Bank of India (SIDBI) and five other Public Sector Banks i.e. State Bank of India (SBI), Punjab National Bank(PNB), Indian Bank, Bank of Baroda and Vijay bank and in near future some other banks are expected to join the portal. The Finance Ministry,while launching the portal said, “The portal sets a new benchmark in loan processing and reducing the turnaround time from 20-25 days to 59 minutes.”One, who applies for loan here, requires tosubmit GST and income tax details and bank statement to be eligible for fast track loan sanctions.Upon approval, the loan amount will be disbursed within 7-8 working days.
This web portal will help the finance ministry and Credit Information bureau to keep checks on frauds and product before the loan is sanctioned
.While applying for the loan, Businessesare requiredto submit the following
GST identification Number, GST user ID and password.
Income Tax E filing password & income tax return details for last 3 financial years.Current account details & Bank Statement for last 6 months
Director/partner details like KYC details, educational and shares in the firm.
Applicant has to deposit a convenience fee of Rs.1000 along with GST
Key features of the Web Portal
1. It is the first insuch kind of platforms in MSME segment which integrates advance fin-tech to ensure seamless fast track loan approval and management.
2. The MSME Financing will be provided by SIDBI and five other PSBs.
3. It is the first digital portal for MSME Borrowers which connects with multiple banks without visiting the branch.
4. Loans are undertaken without human intervention till sanction or disbursement stage under this portal.
5. This portal is a User Friendly Platform, where MSME borrower is not required to submit any physical document for in-principle approval.
6. The web portal uses “sophisticated algorithms” to read and analyze data points from various sources such as IT returns, GST data, bank statements, MCA21 etc. in less than an hour while capturing the applicants basic details using Smart analytics from available documents.
7. It is the only Platform that has been integrated with CGTMSE for checking the eligibility of Borrowers. MSME borrower gets loan up to Rs.2 crore without any collateral, which is major relief for MSME borrowers.
8.The portal will link online loan approval with GST and Tax returns.
By launching this portal, government is taking steps to boost credit availabilityfor small businesses for expansion of their business activities. Although the scheme seems to be very good, but the implementation needs to be equally good.During loan processing for MSMEs, banks are normally taking lots of time.MSME entrepreneurs face lot of hassles even after personal visits and depositing all the documents. So, loan in 59 minutes without visiting to any branch seems to be like a dream. If this dream comes true, then it wouldl help the MSME entrepreneurs in a great way. Similarly from banker’s point of view, steps like personal scrutiny of all the documents, meeting the parties, visiting the business premises, involving many due diligence agencies and collaterals are being taken care of. Ever after taking so many steps & precautions, MSMEs NPA is increasing. Now, if through this portal, loans up to Rs. 1 crore is principally sanctioned in 59 minutes, then bankers would have to be extra cautious in managing & controlling such loans.
If this portal becomes a success, then following benefits to MSME & bankers would be seen:
1. MSME businesses would get timely funding.
2. Middleman and bribes would be the thing of the past.
3. MSME entrepreneurs would file their Income Tax Returns & GST Returns properly and on time, because the loan approval would be based on data feed on these portals.
4. More & more people would like to come under the tax umbrellas as they would get easy funds at much cheaper rates than funds normally available from unorganized sector.
5.Bankers would have more time to manage loan portfolios.
6. Loan through this portal if Income Tax Return & GST return along with financial discipline like verification through portal like CIBIL is automatically done which would save time, it would save the bankers also from taking a wrong decision.
7. In cases approved through this portal, there would be in-principle approval at same time & bankers would have to complete other formalities like final approval, documentation and disbursement of loan within the stipulated time from the date of application.
Successful running of this portal would boost India’s ranking in “ease of doing business” in the whole world

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