Working capital loans are the backbone of every functioning business, especially MSMEs. In 2025, both scheduled banks and NBFCs continue to offer innovative, flexible, and sector-focused working capital loan schemes. This blog compiles the most important working capital finance schemes in India, categorized by public sector banks, private banks, NBFCs, and government-backed schemes.
Why Working Capital Loans Matter in 2025
- Manage liquidity in inflation-sensitive markets
- Fund rising operating costs (raw materials, wages, rent, logistics)
- Bridge delays in receivables or export payments
- Support seasonal or cyclical businesses
1. Public Sector Banks: Working Capital Loan Schemes
✅ State Bank of India (SBI) – SME Working Capital Loan
- Loan Type: Cash Credit, Overdraft, Bill Discounting
- Eligibility: MSMEs with Udyam/GST registration
- Limit: ₹10 lakh to ₹500 crore (based on turnover)
- Security: Collateral or CGTMSE-backed
- Rate: ~9.25–11.5% p.a.
- Repayment: Review annually; OD/cash credit limit renewed yearly
✅ Punjab National Bank – PNB Sanjeevani Scheme
- For MSMEs impacted post-COVID
- Limit: Up to 20% of existing WC limit
- Collateral: Optional under CGTMSE
✅ Bank of Baroda – Baroda Working Capital Loan
- Flexible cash credit/OD limit
- Special schemes for exporters
- Loan Tenure: 12 months with renewal
✅ Canara Bank – MSME Cap Loan Scheme
- Based on turnover, income tax return, GST filings
- Covers working capital and small-term needs
2. Private Sector Banks: MSME Working Capital Offerings
✅ HDFC Bank – Business Working Capital Loan
- Type: CC, OD, Invoice Discounting
- Tenure: 1 year (renewable)
- Limit: ₹10 lakh to ₹40 crore
- Eligibility: 3+ years in business, audited statements
- Turnaround: 48–72 hours with full documents
✅ ICICI Bank – InstaOD and InstaBiz App
- Pre-approved OD based on transaction history
- API-integrated with GST & IT returns
- Collateral-free OD up to ₹50 lakh for select MSMEs
✅ Axis Bank – SME Working Capital Solutions
- Cash Credit + LC + BG bundled in one
- Customized solutions for traders, manufacturers, exporters
- Technology-driven underwriting
3. NBFC Schemes for Working Capital (2025 Edition)
✅ Bajaj Finserv – Business Loan for Working Capital
- Instant approval up to ₹50 lakh
- No collateral
- Loan tenure: up to 60 months
- Easy documentation and EMI plans
✅ Lendingkart
- Digital WC loan up to ₹2 crore
- No collateral, minimal paperwork
- EMI or bullet repayment option
- Turnaround time: 3–5 days
✅ FlexiLoans
- Offers invoice financing, merchant cash advance
- Targeted at e-commerce sellers, service providers
✅ Indifi
- Sector-based WC finance (hospitality, travel, e-com)
- Bill discounting and supply-chain-based financing
4. Government-Backed Working Capital Loan Schemes
✅ CGTMSE (Credit Guarantee Fund Trust for Micro & Small Enterprises)
- Collateral-free WC loan up to ₹2 crore
- Available via all major banks
- 75–85% guarantee coverage
- Low processing time for eligible MSMEs
✅ Stand-Up India Scheme
- Supports women and SC/ST entrepreneurs
- Working capital via overdraft facility
- Integrated with term loans for project funding
✅ PM MUDRA Yojana (Shishu/Kishor/Tarun)
- Loans up to ₹10 lakh
- WC component can be funded under Kishor and Tarun
- Ideal for micro businesses, shopkeepers, artisans
✅ ECLGS 3.0 (Emergency Credit Line Guarantee Scheme)
- Top-up working capital support for COVID-hit sectors
- Available until March 2025 or till funds exhaust
5. Sector-Specific Working Capital Offers
- Export Credit Guarantee Corporation (ECGC) Backed Loans: For exporters
- NABARD Refinance Scheme: For agro and rural businesses
- SIDBI Loans: Tailored working capital solutions via PRAYAAS and ARJANA schemes
Tips to Choose the Right Working Capital Loan in 2025
- Understand your cash cycle – Match loan tenure with operating cycle.
- Prefer collateral-free options if your business lacks fixed assets.
- Go digital – Many fintech-NBFCs offer faster disbursal.
- Compare interest rates and total cost (including processing fees)
- Leverage government schemes – saves on collateral and guarantees
Final Word
In 2025, Indian MSMEs have access to a wide range of working capital loan options—from public and private banks to agile fintech players. Choosing the right scheme involves understanding your business needs, repayment capacity, and industry fit. With growing digital integration, GST-linked underwriting, and government-backed credit guarantees, it’s never been easier—or more critical—to get your working capital strategy right.
Need help choosing or applying for the best working capital loan for your business? bizconsulting.io helps MSMEs with expert financial planning, CMA data preparation, and bank loan syndication.
Tags: Working Capital Loans 2025, Best Business Loans India, MSME Financing Schemes, CGTMSE Loan, NBFC vs Bank Loan, Invoice Financing India
