Documents Required for MSME Loan

Running a business takes hard work, ideas, and sometimes a little financial push. That’s where government MSME loans come in. But before you can get the funds to grow your business, you need to show the right documents. Think of this step as introducing your business to the lender. It proves you're real, reliable, and ready.

In this guide, we’ll break down all the documents required for MSME loan approval in easy steps. Whether you're a shop owner, freelancer, or startup founder, this article will help you get your paperwork in place without confusion.

What is an MSME Loan?

MSME (Micro, Small and Medium Enterprises) loans are special business loans made for small businesses in India. The Government offers them through banks and NBFCs to support business growth. These loans can be:

• Collateral-free (no security needed)
• Fast to process (if documents are correct)
• Customised for new businesses or existing ones

Why Are Documents Important?

Documents show the lender that:

• Your business is genuine.
• You are capable of repaying the loan.
• Your business has legal standing.
• You have income and banking records.

Without proper documents, your MSME loan application can be delayed or rejected.

List of MSME Loan Required Documents

Let’s go over the documents one by one. You don’t need to worry, most are everyday papers you may already have.

1. Identity Proof of Applicant

Submit any one of the following:

• Aadhaar Card
• Voter ID Card
• PAN Card
• Passport
• Driving Licence

Example: Raj, who owns a kirana store, submitted his Aadhaar and Voter ID as identity proof when applying through My Mudra.

2. Address Proof

Provide a current address document like:

• Aadhaar Card
• Driving Licence
• Passport
• Voter ID

Your address proof should match the one used for business communication or utility bills.

3. PAN Card of the Business

• This is compulsory if your business is registered as a company or partnership.
• If it’s a sole proprietorship, your personal PAN may be accepted.

4. Bank Statement (Last 6 Months)

This helps banks understand:

• How much money flows into your account
• Whether you make regular transactions
• Your ability to repay

Tip: Keep your business and personal transactions separate for clarity.

5. Income Tax Returns (ITR)

You need to provide:

• ITR of last 2 years
• Along with Balance Sheet and Profit & Loss account
• All the MSME loan documents must be certified by a Chartered Accountant (CA)

Note: Startups and new businesses may not have 2-year ITRs. In that case, banks may ask for projections or other income sources.

6. Business Continuation Proof

You need to show that your business has been running. Any one of the following can be used:

• Trade Licence
• Sales Tax Registration
• GST Certificate
• Income Tax Returns
• Shop and Establishment Certificate

7. Business Ownership and Legal Documents

Depending on your business structure, you’ll need:

• Sole Proprietorship: Declaration or registration certificate
• Partnership Firm: Partnership deed
• Private Ltd / LLP:
  • • Memorandum of Association (MOA)
    • Articles of Association (AOA)
    • Board Resolution (Authorising the loan)

These help the bank know who is responsible and authorised.

8. UDYAM Registration Certificate

This is the most important MSME loan eligibility document today.

• Register your business on the UDYAM portal
• It proves that your enterprise qualifies as an MSME.

Additional Tips to Speed Up MSME Loan Approval

• All documents must be scanned and in PDF format when applying online.
• Verify whether all names and dates match across all documents.
• Maintain a CIBIL score above 700 for quicker approvals.
• Verify the business PAN and GSTIN to avoid errors that would lead to rejection.
• If applying jointly (for partnerships), ensure all partners sign or provide consent.

How to Apply for an MSME Loan at My Mudra

Step 1: Visit My Mudra

Choose the MSME loan option and start your online application.

Step 2: Fill in the MSME Loan Application Form

Enter your name, business type, income, and contact details.

Step 3: Upload All the Above Documents

Submit all necessary documents digitally. No branch visit is needed!

Step 4: Get Offers and Choose

View loan offers from different banks and NBFCs like Axis Bank, Union Bank, Canara Bank, etc.

Step 5: Loan Approval and Disbursal

Once approved, funds will be credited to your account — often within 24 to 48 hours.

Conclusion

MSME loans from the government can be a daunting process for entrepreneurs, but with the right MSME loan documents, it becomes a straightforward process. The documents provide an overview of a business’ identity, history, operations, and future potential. As part of the efforts to aid owners’ access to funding, the government has made documentation work simpler. Keeping scanned and up-to-date documentation can help to speed up the filling of the online MSME loan application form and prevent delays.

Linking all documents relating to all business documentation and of a consistent nature is also important. For example, all business names need to match on all documents, the bank statements need to show business transactions, and the ITR must be CA-certified.

At My Mudra, we help you streamline the process while also allowing you to compare various MSME loan offers from various banks. Apply wisely, borrow responsibly and build boldly.

Also Read:
- How to Apply MSME Loan for Women
- How to Get MSME Loan for New Business Online?