Bank of Baroda Business Loans

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Bank of Baroda, a reputed public sector bank, offers a wide variety of loans designed for small and medium businesses. It provides financial support to those looking for financial independence and a way to earn their living. Every possible occupation is considered and grouped under a separate loan scheme after considering the role’s needs.

Here is everything you need to know about the business loans offered by the Bank of Baroda.

Loan Types OfferedBaroda Vidyasthali Loan
Baroda Arogyadham Loan
Composite Loans
Working Capital Finance
Term Finance
MSME Loan
Baroda Overdraft for E-Commerce Business
Baroda Tankerz Loan 3-in-1 (CA,BG,TL)
Baroda E-Business Pack
Baroda Loan for Restaurants
Baroda Contractor Scheme
and more
Loan AmountUp to Rs.250 lakh
Loan Tenure12 months up to 10 years
Interest RateBased on repo rate/MCLR

Types of Bank of Baroda Business Loans

Baroda Vidyasthali LoanThis scheme finances educational institutions, including playschool for construction, expansion, modernisation, and renovation.
Baroda Arogyadham LoanAvail loan under this scheme to set up or purchase new clinic/hospital, expansion, renovation, purchase of new medical equipment, and for working capital.
Composite LoansThis scheme is for fixed capital investment or working capital requirement and offers up to Rs.100 lakh. No collateral or third-party guarantee required.
Working Capital FinanceCorporations can avail working capital financing to meet their operating expenses, purchasing inventory, receivables financing, and other purposes.
Baroda Loan for RestaurantsFinancing offered for acquiring, renovating, modernising, decorating interiors, purchasing kitchen equipment, and others are offered under this scheme.
Baroda Contractor SchemeWorking capital assistance is offered for existing and potential contractors and sub-contractors.
SME Short Term LoanThis scheme helps businesses meet their temporary cash shortfall required to continue with their business activities. The repayment tenure is up to 12 months, including the moratorium period.
SME Medium Term LoanThis scheme fills in the working capital gap to meet business requirements with a repayment tenure of up to 36 months with a quarterly or half-yearly instalment structure.

Interest Rates

The rate of interest for Bank of Baroda business loans are linked to repo rate or Marginal Cost of Funds based Lending Rate (MCLR).

MCLR BenchmarkMCLR in (%) w.e.f. 12 March 2021
Overnight MCLR6.55
1 Month MCLR7.00
3 Month MCLR7.15
6 Month MCLR7.25
1 Year MCLR7.40
RatingLarge and Mid Corporate AdvancesNon regulatory SME /SME Expanded Advances
CR-1MCLR + 1.25%MCLR + STRATEGIC PREMIUM + 1.00%
CR-2MCLR + 1.50%MCLR + STRATEGIC PREMIUM + 1.25%
CR-3MCLR + 2.70%MCLR + STRATEGIC PREMIUM + 2.45%
CR-4MCLR + 3.25%MCLR + STRATEGIC PREMIUM + 3.00%
CR-5MCLR + 4.10%MCLR + STRATEGIC PREMIUM + 3.85%
CR-6 & BelowMCLR + 6.50%MCLR + STRATEGIC PREMIUM + 6.25%

Features and Benefits

  • Wide range of loan schemes that suit the needs of various businesses and occupations.
  • Varying loan limits based on the business location, such as rural, semi-urban, urban, and metro areas.
  • Favourable margins for each loan scheme.
  • Term loans and overdraft facilities offered.
  • Moratorium facility is available.
  • Loan amount disbursed based on the credit rating of the applicant’s business.
  • The bank also provides assistance to purchase commercial vehicles, such as tankers and two-wheelers, for food and package delivery.

Eligibility Criteria

Eligibility varies with the loan scheme you choose. Here are the eligibility criteria for a few business loan schemes offered by the Bank of Baroda:

Baroda Vidyasthali Loan

  • All educational institutions, including playschools but limited to Zee School, Euro Kids, Kidzee, World school and their franchise. 
  • HUF are not eligible.
  • Credit rating must be BOB-6 and above.

Baroda Arogyadham Loan

  • All MSMEs that are under Regulatory and Expanded.
  • Real estate projects are not eligible.
  • Promoters/owners should not be HUF.
  • At least one of the Promoters/Director(non-individual)/Doctors should have requisite qualification in any branch of medical science.

Baroda Loan for Restaurants

  • Individuals/Sole Proprietorship/Partnership and company (Private/Public Ltd) or any other such business entity. 
  • Restaurants under the franchisee model may be taken on merits.

Baroda Contractor Scheme

  • MSME units, as per Regulatory definition, engaged in contractor/sub-contractor activity
  • Annual sales turnover up to Rs.250 crore.

Scheme For Professionals

  • Minimum age – 21 years.
  • Maximum age – 65 years at the time of maturity of the loan.
  • Professionals in any discipline.
    • Possess a professional degree (recognised University).
    • Minimum ITR – taxable income of Rs.2.5 lakh
    • Minimum experience of 3 years in their respective fields. 
    • In the CA/CS/ICWA–3 years from the date of the certificate of practice.
    • Minimum bureau score of 700

Fees and Charges

Type of ChargeAmount
Processing charges for Fund Based & Non-Fund Based Working Capital LoanUp to Rs.25,000: Nil
Above Rs.25,000 (Fresh/Review): Rs.350 per lakh or part thereof
Cap for Priority Sector: Rs.35 lakh
Cap for Exporters Rs.17.50 lakh
Others: No cap
Processing charges for DL/TL/DPG/Corp Loan1% of the loan sanctioned
Cap for Exporters: Rs.50 lakh
Cap for Priority Sector: Rs.100 lakh
Other Advances: No cap
Negotiation chargesRs.1,000
Prepayment charges on Term Loan/Demand Loan/Working Capital Demand Loan2% p.a. on the outstanding loan balance for the residual period of prepayment; not applicable for retail loans, including Loan against Future Rent Receivables/Staff Loans

Frequently Asked Questions

Are there finance schemes available for the real estate sector?

Yes. The bank offers business loans to the real estate sector to acquire or build housing complexes, shopping centres, etc. 

How long does it usually take for my loan to get disbursed?

Though the processing time varies on a case-to-case basis, it may take a maximum of 30 days from the date of applying, along with all the required documents.

Does the bank welcome new customers to get short-term business loans?

Bank of Baroda accepts new and existing customers for short-term and medium-term business loans.

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