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How to Get a Business Loan?

How to Get a Business Loan – In simple terms, a business loan can be defined as the funds borrowed from the lender (banks, NBFCs or any other financial institution) for business purposes. But it is not so easy to understand it in simple words. The loan has many varieties and different criteria for every segment of the business world.

Business loan, as the world knows, is usually of a higher amount if your business if well-established whereas a smaller amount of business loan can also be taken to fulfil small business needs.

Let’s look at what all is required to get a business loan:

Why Business Loan?

A Business loan is, no doubt, required to give a flight to your business in this competitive market. It can be required for:

  • Establishing a new business
  • Expanding an existing business
  • Purchase of equipment and machinery
  • Maintenance of inventory
  • Maintenance of liquidity
  • Working capital
  • Repayment of previous debts

What are the Types of Business Loans?

  • Term Loans
  • SBA Loans
  • Business Lines of Credit
  • Equipment Loans
  • Invoice Financing
  • Merchant Cash Advances
  • Business Credit Cards
  • Microloans

What is the Eligibility of Business Loan?

An individual who is willing to avail the business loan must fulfil specific criteria. These eligibility criteria may vary, and it all depends on the banks. Some of the common eligibility criteria are:

  • The company should be private limited or partnership firm.
  • The loanee should be at least 21 years old.
  • The business should be stable and profitable for at least two consecutive years.
  • The annual income or turnover of the business should be at least Rs 40 lakhs.
  • The balance sheet should be audited by a CA.

What are the Documents Required for Business Loan?

  • Address proof
  • Identity proof
  • Business proof and proof of continuation
  • PAN card
  • Last three years audited financials
  • ITR of last one year
  • Sales tax returns of 3 years
  • Other documents required by the bank.

What is the Repayment Period?

The repayment period of loan depends on its tenure and EMI. The long-term loans can run up to 20 years while short-term loans can be repaid within months to a year from the date of sanctioning.

What are the Interest Rates?

The rate of interests is different for each bank. Each bank has its criteria for interest rates. The banks also levy processing charges along with these interest rates. Let’s look at the business loan interest rates of top 5 banks:

Name of Banks Interest Rates (per annum)
ICICI Bank 16.00% to 22.00%%
HDFC Bank 15.65% to 21.20%
RBL Bank 19.00% to 26.00%
Bandhan Bank 16.00%
SBI 11.20% to 16.30%
Capital First 16.00% to 24.00%
Aditya Birla 17.00% to 26.00%
Bajaj Finserv 18.00% onwards

How to Apply? 

Follow these quick steps to start your business loan journey today !

Step 1 : You can simply click on the link to submit the form

Step 2 : Fill all the required professional & personal details and Get instant quote on your Eligibility, Documents required & Other important procedure.

Step 3 : Our representative will get in touch with you to help you further.