Planning on starting a small business in Delhi? Govt to offer collateral-free loans up to Rs 10 crore

Under this scheme, the Centre will extend 75-90% guarantee to cover the loan, while the Delhi government will provide the remaining guarantee, said Gupta.

Besides, the scheme will cover all small and micro sectors such as manufacturing, service and retail. The Delhi government has also set the non performing assets (NPA) limit at 10% to keep its financial liability in check.

Terming the initiative as a step towards ‘Viksit Dilli’, Gupta said, “There are lakhs of traders, manufacturers and young entrepreneurs with small-budget start-ups and businesses in Delhi who are forced to run from one bank to another for loans. Many do not get it due to the requirement of collateral. But, it will be a thing of the past… All the small entrepreneurs can now avail collateral-free loans without having to run from pillar to post.”

Sirsa said that more funds will be allocated for this in the future, if needed. He explained that this scheme has a 50-fold leverage, meaning that an investment of Rs 2 crore will enable a loan of up to Rs 100 crore.

Sirsa also said that women and SC entrepreneurs have been provided further relief under the scheme that is expected to benefit around one lakh people this year.

Further, calling the initiative a historic gift for Delhi’s industrial and economic future, the minister said that it represents a major structural reform for nearly one million MSMEs in the Capital, including over two lakh manufacturing units.

“Traditional banking practices, such as excessive documentation, property-related paperwork and collateral requirements have long posed barriers to credit access, particularly for women entrepreneurs…BJP government’s objective is not merely credit disbursal, but to empower MSMEs for large-scale investment and long-term expansion,” he said.