New Delhi, Oct 11 (KNN) As many as 21 state run banks have been asked by the finance ministry to standardize loan processes and products for micro, small and medium enterprises (MSMEs) that will be hawked online with the promise of approving them within an hour.

The ministry has said all banks, which are now on board, will have at least one common product with the option to offer variations.

This will enable small businesses to meet their term loan and working capital needs through an online platform that will be contactless.

Given the difference in loan products, according to the sources, the new loan sanction portal put in place last month has seen over 1 lakh hits. But the number of approvals was not high.

Nearly two-thirds of the visitors are reportedly under 35 years of age.

The report added that banks have been told to offer loans to companies with a debt-equity ratio of 4:1, given that MSMEs typically have a lower equity base.

Sources indicated that as two private lenders, HDFC Bank and ICICI Bank, also showing interest in the new portal, the platform may be opened to those outside the public sector too.

Last month, the government had announced funding of up to Rs 1 crore in 59 minutes flat for MSMEs.

The facility is available for businesses that submit GST and income tax details, along with their bank statements, for speedier loan sanctions.

The loan will be disbursed within eight days.