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Apply for Canara Business Loan | Low Interest Rate
Canara Bank is one of the most reputed banks in India, offering various financial services to customers across the country since 1906. The bank, with over a century of experience in the industry, offers state-of-the-art banking solutions.
This includes the various types of business loans offered by the bank to startups, small and medium enterprises (SMEs), as well as established organisations.
Here are some essential features of the business loans offered by Canara Bank that you should know about:
Particulars |
Details |
|---|---|
Minimum Loan Amount |
No Limit |
Maximum Loan Amount |
₹25 Crores or more (case-by-case basis) |
Starting Interest Rate |
8.75% p.a. (as per RLLR) |
Maximum Tenure |
Up to 10 years with additional moratorium |
Disclaimer: The mentioned details are subject to change at the lender’s discretion.
Canara Bank business loan comes with flexible repayment and a streamlined application process. Check out the additional features and benefits of this loan:
You can get a loan of amounts as high as ₹25 Crores to meet your business's financial needs efficiently.
With Canara Bank Business Loans, you can enjoy a repayment tenure of up to 10 years with an additional moratorium period.
The bank allows you to apply for a business loan online and offline, based on your convenience.
You can use the funds to meet various financial needs of your business, including payroll, purchasing raw materials, paying utility bills, etc.
Here are the applicable Canara Bank business loan interest rates offered:
Loan Type / Exposure |
Applicable Interest Rate / Charges |
|---|---|
Working Capital & Short-Term Loans (≤ 36 months) |
RLLR + 1.05% (for all sanctions up to ₹2 Lakhs) |
Term Loan up to ₹50,000 |
RLLR + 1.30% |
Term Loan above ₹50,000 – ₹2 Lakhs |
RLLR + 1.55% |
Loan Exposure ₹2 Lakhs – ₹1 Crore |
Based on Credit Risk Rating |
Exposure ₹1 Crore– ₹2 Crore |
Linked to the % of the value of immovable property & internal risk grade, including CGTMSE coverage if applicable |
Exposure ₹2 Crore– ₹7.5 Crore |
Similar to above, based on the % of security value & internal Risk Rating |
Exposure ₹7.5 Crore– ₹50 Crore |
Linked to the % of the value of immovable property, internal Risk Rating/Grade |
Exposure above ₹50 Crore (externally rated) |
Rate of Interest linked to External Risk Rating/Grades by ECAIs |
Exposure above ₹50 Crore (internally rated) |
Based on internal Risk Grade + 0.50% until externally rated |
For loans repayable for more than 1 year, the liquidity premium is added to the card rates.
Loan Tenure |
Interest Rates |
|---|---|
1 year to 2 years |
+0.20% |
2 years to 3 years |
+0.25% |
3 years to 5 years |
+0.25% |
5 years to 7 years |
+0.30% |
7 years to 10 years |
+0.30% |
Above 10 years |
+0.45% |
Disclaimer: The mentioned rates are subject to change at the lender’s discretion.
Comparing Canara Bank business loan interest rates with other lenders helps you choose the most suitable borrowing option. Here are the details from other lenders to support your decision.
Banks/NBFCs |
Interest Rate |
|---|---|
NeoGrowth |
18.00% onwards |
Tata Capital |
12% p.a. onwards |
IDFC First Bank |
13.5% p.a. onwards |
ICICI Bank |
13.25% onwards |
Bandhan Bank |
13% p.a. onwards |
IndusInd Bank |
15.99% p.a. onwards |
YES BANK |
15.99% p.a. onwards |
HDFC Bank |
10.75% p.a. onwards |
Canara Bank |
8.75% RLLR + up to 1.55% p.a. |
Kotak Mahindra Bank |
9.00% p.a. onwards |
Disclaimer: The above-mentioned rates are subject to change as per changes in the bank’s policies
Here are the various types of business loans that Canara Bank offers:
Canara Bank offers tailored term loans and working capital facilities to support startups and MSMEs recognised by DPIIT. These loans support a wide range of business needs, such as development, hiring, marketing, and growth initiatives.
Category |
Details |
|---|---|
Purpose |
Financial assistance for startups covering: Prototype creation, equipment purchase, certifications, hiring, legal services, marketing, and office leasing. |
Target Group |
Micro, Small and Medium Enterprises (MSMEs) recognised as startups by DPIIT. |
Quantum of Loan |
Minimum: Above ₹10 Lakhs |
Repayment Period |
Working Capital – 1 year |
Processing Charges |
As per the scheme guidelines |
Canara Bank’s Working Capital Finance helps businesses manage short-term financial requirements. It covers daily operational expenses such as inventory, salaries, and receivables.
Category |
Details |
|---|---|
Purpose |
To invest in current assets like raw materials, stores, semi-finished/finished goods, and debtors. Covers raw material purchase, power bills, etc. |
Target Group |
Businesses with ongoing operational needs; applicable for different industries depending on cash cycle and turnover. |
Quantum of Loan |
Depends on the working capital requirement assessed using methods like the Turnover Method, MPBF System, Cash Budget System, etc. |
Repayment Period |
Generally 1 year (renewable); interest and repayment as per facility terms. |
Processing Charges |
As per the bank’s general guidelines and lending norms. |
Canara Bank offers infrastructure finance to support large-scale projects across various sectors. These loans are tailored for long tenures and high-value funding, with additional financial support to meet project needs.
Category |
Details |
|---|---|
Purpose |
Financing infrastructure projects involving large capital outlays and long gestation periods. |
Target Group |
Project promoters involved in infrastructure sectors requiring long-term funding and include public and private sector entities. |
Quantum of Finance |
High-value funding depending on project size. It is often part of a consortium or syndicated arrangement. |
Tenure |
Longer repayment period based on the project’s cash flow and repayment capacity. |
Processing |
Requires technical feasibility, economic viability, and sensitivity analysis. Often supported by an MOU with India Infrastructure Finance Company Ltd (IIFCL). |
Canara Bank offers Export Finance solutions to support businesses involved in or planning to enter export activities. These loans include pre-shipment and post-shipment financing, as well as foreign guarantees and letters of credit.
Category |
Details |
|---|---|
Purpose |
To finance export-related working capital needs, both before and after shipment, and facilitate imports via guarantees and letters of credit. |
Target Group |
Export-oriented units or businesses involved in international trade, including those importing capital goods or raw materials. |
Quantum of Finance |
Based on export order value, working capital requirements, and creditworthiness |
Tenure |
Varies by facility (Pre-shipment finance or post-shipment finance) |
Processing |
Subject to FEMA and RBI guidelines |
It provides financial assistance to eligible contractors and subcontractors through working capital and term loan facilities. The scheme supports businesses involved in government or private contract work with flexible loan options and collateral-based security.
Category |
Details |
|---|---|
Purpose |
To provide working capital (fund-based/non-fund-based, like Secured OD, FLC/ILC BG) and term loans for purchasing new equipment or office premises. |
Target Group |
MSMEs involved in contract work across civil, mining, electrical, mechanical, and construction sectors, maintaining accounts with Canara Bank. |
Quantum of Finance |
Minimum ₹25 Lakhs for both Working Capital and Term Loan. |
Tenure |
Working Capital: Tenable for 1 year. |
Processing |
Security includes hypothecation of assets. Minimum collateral: 50% of proposed exposure via land/building or approved financial securities (as per the scheme). |
It also offers tailored credit facilities for MSMEs engaged in manufacturing or services. Businesses can access term loans and working capital backed by immovable property or approved securities to meet diverse operational needs.
Category |
Details |
|---|---|
Purpose |
To provide credit facilities for MSME borrowers’ business needs in manufacturing and services, against mortgage of property or other approved security. |
Target Group |
Micro, Small and Medium Enterprises (MSMEs) engaged in the manufacturing or service sector. |
Quantum of Finance |
Minimum loan of ₹10 Lakhs. |
Tenure |
Working Capital: Tenable for 1 year. |
Processing |
Primary security in the form of immovable property (existing/proposed). |
This scheme empowers women entrepreneurs by providing financial support for various business needs. It is specifically designed for women-led MSMEs, including retail traders.
Category |
Details |
|---|---|
Purpose |
To finance the purchase/construction of business premises, machinery, equipment, vehicles, and working capital needs of women-owned Micro, Small & Medium Enterprises. |
Target Group |
Women-owned enterprises complying with MSME guidelines (as per the MSMED Act 2006 and revisions effective from 01.07.2020). |
Quantum of Finance |
Minimum loan above ₹10 Lakhs. |
Tenure |
Working Capital: Tenable for 1 year. |
Processing |
Primary Security: Hypothecation of assets created from the loan. |
This scheme offers financial assistance to qualified professionals for setting up, expanding, or upgrading their offices. It provides term loans and working capital facilities, with loan limits tailored to the location.
Category |
Details |
|---|---|
Purpose |
To finance the purchase/construction of office premises, acquisition of machinery, equipment, furniture, fixtures, or office expansion and need-based working capital (secured OD). |
Target Group |
Professionals such as Architects, Engineers, Valuers, Financial/Management Consultants, Chartered Accountants, Cost Accountants, Company Secretaries, and registered Doctors (MBBS). |
Quantum of Finance |
Minimum: ₹10 Lakhs |
Tenure |
Working Capital: Tenable for 1 year |
Processing |
Primary: Hypothecation of assets from the loan |
This facility supports GST-registered MSMEs by providing working capital through fund-based and non-fund-based options. It ensures liquidity by securing loans against mortgages or approved financial securities.
Category |
Details |
|---|---|
Purpose |
To provide credit for working capital needs of GST-registered MSME borrowers, secured against mortgage of property or approved securities. |
Target Group |
Micro, Small & Medium Enterprises (Manufacturing/Services) registered under GST. |
Quantum of Finance |
Minimum: ₹10 Lakhs |
Tenure |
12 months (working capital limit) |
Processing |
Collateral security of at least 75% of the loan amount required, via: |
This scheme offers financial support to registered medical practitioners for setting up, expanding, or modernising their practice. It provides both term loans and working capital with flexible limits and tenure.
Category |
Details |
|---|---|
Purpose |
To provide credit facilities to registered medical professionals for manufacturing and service activities in the medical field, against property mortgage or approved securities. |
Target Group |
Registered practitioners of Allopathy, Homoeopathy, Unani, and associated business units under MSME classification. |
Quantum of Finance |
No minimum limit |
Tenure |
• WC: Tenable for 2 years (subject to annual review) |
Processing |
Primary: Mortgage of land/building, hypothecation of medical equipment and medicine stocks |
This scheme supports transport operators and MSMEs in financing new (electric and fuel-based) as well as second-hand (fuel-based) commercial vehicles. It covers a wide range of vehicle types with flexible collateral and margin requirements.
Category |
Details |
|---|---|
Purpose |
To finance new (electric/fuel-based) and second-hand (fuel-based only) commercial vehicles, including cargo autos, taxis, buses, and hybrid vehicles permitted by authorities. |
Target Group |
Existing/new borrowers, including individuals, firms, companies, and registered transport operators under MSME – Manufacturing and Services (including retail traders). |
Quantum of Finance |
• New Vehicles: ₹0 to ₹50 Lakhs |
Tenure |
• New Vehicles (Fuel): Max 84 EMIs |
Processing |
Primary: Hypothecation of a financed vehicle |
This tailored loan supports MSME borrowers in the hotel and hospitality sector. It offers term loans and working capital limits with flexible repayment options and security terms.
Category |
Details |
|---|---|
Purpose |
To provide credit for MSME borrowers in hotel-related businesses through Fund-Based/Non-Fund-Based Limits and Term Loans. |
Target Group |
Units in the Hotel Industry sector like Hotels, Resorts, Restaurants, Fast Food Centres, Dhabas, Pizza Centres, Mess, Caterers, Marriage/Banquet halls. |
Quantum of Loan |
Minimum: Above ₹10.00 Lakhs |
Tenure & Repayment |
Working Capital: Tenable for 1 year |
Processing Charges |
Based on the borrower's rating: |
This scheme provides financial support to MSME units in the textile manufacturing sector. It offers both working capital and term loan facilities with tailored benefits for eligible businesses.
Category |
Details |
|---|---|
Purpose |
To provide credit for Working Capital / Term Loan requirements (Fund-Based and Non-Fund-Based) for MSMEs engaged in textile manufacturing. |
Target Group |
Units in textile manufacturing, including: |
Quantum of Loan |
Minimum loan amount above ₹10 Lakhs |
Tenure & Margin |
Margin for WC/TL: 25% |
Processing Charges |
50% concession on the applicable upfront/processing fee and NFB commission |
To know more about these in detail, visit the official website of Canara Bank.
Here are some common criteria you need to meet to get a business loan from Canara Bank:
You should be an Indian citizen
You should be between the ages of 21 and 65 years
A minimum business vintage of 3 years is required
You must be a self-employed applicant
The following people/entities may be eligible to get a business loan from Canara Bank:
Individuals
Sale Proprietors
Private Limited
Public Limited
Trusts
Societies
Limited Liability Partnership
Micro, Small, and Medium Enterprises (MSME)
Registered Transport Operator Under an MSME
Depending on a specific loan type, here are the people/entities who can apply for a Canara Bank Business Loan:
Professionals:
Architect
Engineer
Valuer
Financial Consultant
Chartered Accountant
Company Secretary
Cost Accountant
Registered Doctor
Medical Practitioners: Involved in the following areas of medicine
Indian
Unani
Homeopathic
Allopathic
Businesses in the Hotel Industry:
Hotel
Restaurant
Fast Food Centre
Dhaba
Pizza Centre
Mess
Caterer
Marriage/Banquet Hall
Businesses in the Textile Industry:
Yarn Manufacturer
Manmade Fabric Manufacturer
Jari Manufacturer
Processor of Fabrics
Saree, Dress Material, and Other Garment Manufacturer
Businesses in Contract Work:
Civil
Mining
Electrical
Construction (awarded by the government or otherwise)
Since Canara Bank offers several types of business loans, the documentation requirement depends on the type of loan you apply for. However, there are some common Canara Bank business loan documents required. These include:
NF998 MSME application
Identity Proof such as PAN card, Driving licence, Passport, or Voter ID
Address Proof of units and promoters
Applicable permissions and licenses
ITR filings of the last 3 years and other financial documents
Balance sheet of the last 3 years
Details of the guarantor with proof of assets
Business proof based on the type of entity (proprietor, company, partnership, etc.)
Stock statement
Here are the steps you need to follow to apply for a Canara Bank Business Loan:
Go to the official website of Canara Bank and click on ‘Download Centre’ at the bottom of the page
Download the relevant application form
Fill out the application form with the necessary details
Go to your nearest Canara Bank branch to submit the form and required documents
Once you apply, the bank representative will assess it, verify your documents and guide you regarding the next steps.
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Canara Bank provides business loans of up to ₹25 Crores. A higher amount may be sanctioned. However, this is determined on a case-by-case basis. The loan amount is decided depending on the type of loan you apply for, the credit profile of the business, the credit score etc.
You can check the status of your business loan application with Canara Bank by contacting their customer care at 1800 1030.
Yes, Canara Bank offers a range of MSME loans designed to meet various business needs, including working capital, expansion, and asset creation. These loans come with flexible repayment options, competitive interest rates, and tailored solutions for different sectors.
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