Can I get an SME loan if I don’t have a Permanent Account Number (PAN)?

PAN Card

When you apply for an SME loan with a formal lender, you are required to submit a colour copy of your individual and business PAN card along with your business loan application. Therefore, you cannot get an SME loan if you do not have a PAN. Let’s find out why.

What is a PAN?

The Permanent Account Number, also known as PAN, is a ten-digit unique alphanumeric identification number issued by the Income Tax Department (IT Department). Every individual and corporate taxpayer who does business in India must have a PAN.

Your PAN is legally required to be linked to your Aadhaar, bank accounts, and credit report and helps a lender verify your financial history when you apply for an SME loan. You also need your PAN to get your GST registration. 

Can I apply for an SME loan if I don’t have a PAN?

No, you are not eligible for an SME loan with any lender in India if you do not have a PAN.

When you apply for a loan, you will need to submit both your individual PAN card as the business owner and your company PAN card unless your business is a Proprietorship firm. If your business is a proprietorship firm, then the lender only needs the PAN information of the proprietor (owner) to process the application.

I have my PAN card. I’m ready to start my business loan application now.

Does my company need a business PAN card?

The following entities need a business PAN card to do business in India:

CompanyPartnership firm
Association of personsLimited Liability Partnership (LLP)
Body of IndividualsTrust
IncorporationLimited company
Private firmAssociation
Foreign institutional investorHedge fund
Entities that need a Business PAN in India

Tell me more about company PAN cards.

Why do I need a company PAN card?

Any domestic or foreign entity operating in India needs a company PAN card. The company PAN card helps you in the following ways:

  1. Any tax-related documentation is issued under your PAN. Therefore, it helps the tax authorities and financial institutions easily track any tax-related transactions you make.
  2. Having a PAN allows you to make invoice payments without deduction.
  3. If you don’t have a PAN, the government can charge you 30% or more of your invoiced payments.

Apply for a PAN online via the NSDL portal.


To be eligible for an SME loan from a formal lender in India, you are required to have a personal and company PAN (where applicable). The government has made applying for a new PAN a simple, digital process, so you can easily apply for it online if you don’t already have one.

Remember, According to Section 272B of the Income Tax Act, 1961, you can be fined a penalty of ₹ 10,000 if you have more than one PAN.

When you apply for an SME loan, remember to give the lender a colour copy of your PAN or e-PAN card so that they can swiftly assess your application and approve your business loan request.

Why do lenders need a colour copy of my PAN when I apply for an SME loan?

Ready to apply for an SME loan? Start your application today!

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