Top Banks and NBFCs Offering Machinery Loans in India

In the fast-paced world of today, having the right machinery is a game-changer for most businesses and MSMEs; as such, it is quite important so that they can stay competitive in the market. But staying competitive requires the latest machinery, which for most businesses means putting a strain on the capital.

That’s where the machinery loan comes into play; it is a loan granted to MSMEs in India, which allows businesses to stay on top of their game and purchase the latest equipment. But what is it? In this article, we’ll be diving into just that.

What is a Machinery Loan?

Startups, entrepreneurs, business owners, independent contractors, and other business entities can obtain loans to purchase new or used machinery and equipment for a variety of commercial uses with the help of a machinery loan.

Equipment loan for business helps businesses to use new machinery and equipment more productively. Increased output or production leads to increased sales and distribution profitability.

Benefits of Taking a Machinery Loan in India

There are many benefits when it comes to taking machinery loans in India. They are:

• Enhancing Production Efficiency: Efficiency is the key to any business, and acquiring the latest machinery helps in just that. With a business loan, you get access to some of the best machinery and increase your production.
• Increasing Production Capacity: For a business to grow, it needs to be able to make more things. Machinery loans make this possible without having to worry about money.
• Financial Flexibility: You are able to retain your working capital for other essential expenses.
• Competitive Advantage: When you have access to the latest technology and machinery in the market, you are able to stay ahead of your competitors.
• Tax Benefits: If you take a machinery loan in India, you can opt for tax deductions for your business.

Top Banks Offering Machinery Loans in India

Here at My Mudra, there are many banks that offer machinery loans. The top 5 banks that provide machinery financing are:

1. State Bank of India (SBI) – SME Open Term Loan

This loan is designed for businesses that are looking to upgrade their machinery and modernise. The minimum loan amount is ₹25 lakh, and it can go up to as much as ₹10 crore. The interest is market competitive, and it has a tenure of 8 years. You’re eligible for this loan if you’re an existing SBI customer in the manufacturing sector and have a satisfactory credit score.

2. HDFC Bank – Business Loan for Manufacturers

This is another loan scheme designed for the expansion of operations and the purchase of machinery. The loan amount can go up to as much as ₹40 Lakh and has a tenure of 12 to 48 months. The best part about this loan is that no collateral is needed for this loan. You also have an overdraft facility, which can be anywhere from ₹5 Lakh to ₹15 lakh. You’re eligible for this loan if you have a total turnover of ₹40 lakhs, have been in profit for the previous 2 years and have been in the current business for 3 years. The interest rate can range anywhere from 10.75% to 22.50%, and the processing fee is 2% of the loan amount.

3. Canara Bank – Machinery Loan

This loan is perfect if you’re seeking to upgrade your machinery or purchase new equipment. The interest rates start from 9.5% per annum, and the repayment options are flexible, aligned with the cash flow of the business. You can also avail of collateral-free options if your business profile is suitable and you are eligible if you’re in the manufacturing or construction sector.

4. Axis Bank

This loan allows you to avail of anything from ₹10 lakh to ₹5 crore without any collateral up to ₹3.4 crore. It is also intended to purchase machinery and expand your business for a tenure that ranges from 12 months to 60 months. The processing fee is 1% of the amount + applicable taxes, and the interest rate is competitive as per market standards.

Top NBFCs Offering Machinery Loans in India

Several NBFCs offer competitive interest rates on machinery loans. Here are the top 3 NBFCs that you can rely on: 

1. Bajaj Finserv

You can fund your working capital requirements with ease with machinery loans from Bajaj Finserv— one of the leading providers of machinery loan in India. They offer a loan amount up to 80 lakhs. What’s best? You need not pledge any collateral, and in fact, you get loan approval even within 48 hours. The interest rates are typically between 9.75% and 30% per annum, and a low processing fee of up to 3.54% may be applicable. 

2. Tata Capital

This NBFC offers machinery loans with competitive terms and focuses on personalised financial solutions. With Tata Capital, you can get machinery finance from Rs. 0.40 lakh to Rs. 90 lakhs. Moreover, the tenure is usually 12 months to 60 months, and the interest rates start from just 16% per annum. The processing fee is also minimal —4% of the loan amount. So, you can meet all your needs with ease and repay conveniently.  

3. MAS Financial 

MAS Financial provides Machinery Loans to small businesses looking to purchase the latest equipment or upgrade their existing machinery. You can get a loan of as much as ₹2 crores, and the loan tenure is up to 60 months. Moreover, the interest rate is anywhere between 12% and 24%, and the schemes can be customised as per your requirements.

Wrapping Up 

Now that you know the top banks and NBFCs offering machinery loans in India, it’s time to pick one that best aligns with your needs. Worried about the hassle of lengthy processes and online applications? We have got you covered!

At My Mudra, we bring you quick approvals, reasonable interest rates, and flexible repayment options. Explore the options now and take your business to newer heights with all-new machinery!