Business loan for a new business, without ITR history
Banks normally ask for 2–3 years of ITR. A new business has none. That does not shut the door: for a new unit, the bank judges the project report, your own money in it, your experience and your personal credit record. Here is what fits a first-time founder.
Updated 2026-10-27 · Funding Desk credit panel
Options that work for a new business
| Option | Best for | Amount |
|---|---|---|
| PMEGP | New manufacturing or service unit, with subsidy | Project up to ₹50 lakh |
| Mudra (Shishu, Kishore, Tarun) | Small shops, services, small units | Up to ₹10 lakh |
| Bank loan with CGTMSE cover | Larger new units without property | Up to ₹10 crore |
| Stand-Up India | Women and SC/ST founders, new unit | ₹10 lakh to ₹1 crore |
| CGSS for startups | DPIIT-recognised startups | Up to ₹20 crore |
What the bank will look at
- Project report – costs, expected sales, profit and how the EMI will be paid. This replaces the ITR.
- Your own contribution – usually 10% to 25% of the project cost, sitting in your bank account
- Experience – years in the same line, even as an employee
- Your personal CIBIL score and existing EMIs
- Udyam registration and premises papers
What to avoid
- Instant-loan apps at 30%+ a year to fund a business
- Applying at five banks in a week – every enquiry lowers your score
- Inflated sales in the project report – banks compare it with similar units
Common questions
Can I get a business loan without ITR?
Yes, for a new unit. The bank relies on the project report, your own contribution and your credit record. Mudra and PMEGP are made for this.
How much of my own money do I need?
Usually 10% to 25% of the project cost. Under PMEGP it is 5% for special categories and 10% for others.
Do I need property as security?
No, for micro and small units. RBI does not allow banks to ask for collateral on loans up to ₹20 lakh to micro and small enterprises, and CGTMSE covers larger loans.
Which is better for a new shop – Mudra or PMEGP?
Mudra. PMEGP does not cover trading, so a shop or franchise should look at Mudra or a CGTMSE-backed loan.