Business Loans 2019-02-16T09:12:35+00:00

Business Loans

Get the best rates for your business loans

What is a Business loan?

A business loan is basically an unsecured loan at an interest rate which gives you access to credit that can be paid back over an agreed time along with the interest, without any security against it. A business loan is considered as a debt that the company is obligated to repay according to the loan’s terms and conditions, before approaching a lender for a loan. Besides, it is imperative for business owners to understand how loans work and what the lender will want to see from the owner.

If you are to start up a business then you surely require an upfront capital investment. This usually comes in the form of:

  • A business loan: it is the money borrowed from a financial lender
  • Equity finance:an investment from the government, friends, family, private investors or venture capitalists
  • Asset finance:It can be borrowed to finance the hire or purchase of equipment.

Hurry up! Apply for easy loans through Finbucket today. We excel in business funding in a hassle-free manner.

What are the types of Business loan in India?

  • Demand Loan
  • Term Loan
  • Loan against Securities
  • Cash Credit Facility and Overdraft Facility
  • Letter of Credit (LC) Facility and Bank Guarantee

What things should be considered while applying for a business loan?

Following are some tips:
Loan amount:

The amount that you borrow from the bank should be enough to cover the remaining expenses. But, the amount of loan will be considered a liability.

Interest rate:

Like other bank loans, you need to choose either a fixed or variable interest rate. When considering your business loan options, calculate how the different rates will impact your repayments.

Collateral:

You are free to take either a secured loan or unsecured business loan. Actually, a secured business loan might come with a lower interest rate, you will need to offer up another asset as security against the loan. On the other hand, an unsecured loan doesn’t require any collateral, but you might be hit with a higher interest rate. There are some lenders that also require a personal guarantee from the borrower. Might be, a lender also includes a fixed or floating charge to secure a borrower’s assets. This kind of security allows the lender to seize any asset to repay the loan immediately if the terms of the loan are not met.

Business Profits:

Remember, the amount of money your business makes will directly impact the size of your loan. So, your lender will want to ensure you can make repayments each month until the loan is paid off, so you will need to provide evidence of how much money you expect to make. If it is a new business then will need to provide 2-3 years of cash flow forecast, protection and indemnity insurance, and balance sheet forecast alongside a business plan with their application. Moreover, established business will need to provide a two to three years trading history along with tax returns.

Business Loan Eligibility criteria

Before applying for a Business loan, you will require the following documents:

  • Proprietors, Self-employed individuals, Private Ltd. Co. as well as Partnership Firms involved in the business of Manufacturing, Trading or Services.
  • It is mandatory to have a minimum turnover of Rs. 40 lakhs
  • Individuals who are engaged in the current business for a minimum of 3 years, with 5 years of total business experience.
  • Whose business is giving profit since the previous 2 years.
  • Whose business have a Minimal Annual Income (ITR) of Rs. 1.5 lakhs per annum
  • Maximum age limit of the applicant should be at least 21 years at the time of applying for the loan and should be no older than 65 years at the time of loan maturity.

Documents required for Business loan in India

Following are the documents:

-PAN Card – For Company/Firm/Individual

-Identity Proof (Any one out of the given)

  • Aadhaar Card
  • Passport
  • Voter’s ID Card
  • PAN Card
  • Driving License

Address Proof (Any one out of the given)

  • Aadhaar Card
  • Passport
  • Voter’s ID Card
  • Driving License

-20-Bank statement of the previous 6 months

-Latest ITR along with computation of income, Balance Sheet and Profit & Loss account for the previous 2 years, after being CA Certified/Audited

-Continuation Proof (ITR/Trade license/Establishment/Sales Tax Certificate)

-Other Mandatory Documents such as Sole Prop. Certified, Certified original true copy of Memorandum & Articles of Association (certified by Director) & Board resolution, Copy of Partnership Deed

How to get Business loan through Finbucket?

Following are the steps:

  • First of all, you have to fill a simple application form which will demand your basic business information given on the site.
  • We are having co-ordination with 30+ banks/NBFC to get your application to them.
  • You can compare interest rates by your own and choose the best one for you.
  • Then, we will send you an e-approval that your loan application is accepted within 24-48 hours and the amount will be credited to your account.

Business Loan Interest Rates Comparison, Best Business Loan Rates 2017

BanksLowest Business Loan Interest RatesProcessing Fee
SBI Business Loan11.20%From 2% to 3%
HDFC Bank BusinessLoan 15.50%Starting from 0.99%, Max 2.50%
ICICI Bank BusinessLoan 12.15%Starting from 0.99%, Up to 2%
Citibank15.99%Starting from 2%, Up to 3%
RBL Bank20.00%3% of loan amount
Tata Capital13.50%From 1.50% to 2.50%
Lendingkart18.00%1% of loan amount
Bajaj Finserv14.00%Upto 2% of loan amount
Kotak Bank16.00%Upto 2%
Bank of Maharashtra14.50%1% of loan amount, Min Rs. 1,000
Capital First16.00%1.99%
IndusInd Bank14.00%2.50%
Bank of Baroda14.10%Upto 1%
Fullerton India16.00%2%
IDBI Bank13.00%1%
Allahabad Bank11.10%Rs. 229 – per lac, Min Rs. 2,038 Max Rs. 22,928
PNB12.60%1.8% + taxes
OBC11.95%0.50% Loan Amount
Indian Overseas Bank14.090%Rs. 204 per lakh
Dhan Laxmi Bank13.15%
DCB Bank10.70%2%
Andhra Bank15.75%Case to Case
United Bank of India14.15%1.15%
Corporation Bank13.55%1.5%, Min Rs. 500
Syndicate Bank14.45%0.5%, Min- Rs.500

What are the factors that decide the interest rates of Business loans?

Following are the factors:

  • Credit score
  • The applicants having a good credit score can easily walk into any bank to get a business loan and the better you score, the more you can avail. The rate of interest will also depend on the same.

  • Time in Business
  • The minimum operation period is of two years or more irrespective of what type of business it is. Longer the existence of the business more will be the probability of getting a loan.

  • Monthly Revenue
  • Revenue is always a key factor for any type of loan. But for a business loan, the consistency is the main factor. Generally, all business has different revenue at a different period, but having consistency is crucial. The balance of day-to-day is analyzed by the banks to determine the loan amount and repayment capability.

  • Collateral
  • The security is pledged with a bank loan. More the collateral value, more will be the benefits. It provides security to the banks to offer bigger amount as the risk is low. There are different types of collaterals such as deposits, home equity, investment real estate, and equipment.

Why to choose Finbucket for Business Loan?

Following are the reasons:

  • Our company Finbucket collaborates with various public sector and private sector banks to offer customized personal loans including small loans or anything for its users. You can easily apply for a business loan online with the help of Finbucket.
  • It helps in the calculation of quick loans and checks for the user’s business loan eligibility instantly.
  • The eligible loan applicants are offered instant quotes as per their profile and with discounted interest rates.
  • It also allows users to compare the best deal on their own. You can simply compare the loan offers of various banks at different rates and can choose by their own with which bank they want to go for.
  • Besides, feedback shared by previous successful business loan applicants acts as a helpful tool for new applicants to get the best business loan deal.
  • Finbucket can generate instant e-approval as soon as the user successfully submitted his/her business loan application.
  • Applications for personal loans submitted with Finbucket are sent electronically to the concerned bank department assuring complete privacy and transparency.

Frequently Asked Questions

Get answers to all your questions

1. Why should I take a business loan?

    No business can run successfully in case of shortage of capital. You can get a business loan from Finucket for your short or long term financial needs. Whether your business is at an initial stage or in the growth phase, additional finance can help you keep up the momentum.

    2. How does a line of credit work?

      A line of credit is different from most term loans. Post approval, you can generally borrow whenever you want. There is no need for you to take the money immediately after approval. As long as you have not borrowed the maximum limit, you can continue to borrow a little bit today, and more tomorrow if need be. You pay interest only on the amount you’re borrowing, and you always have the option of paying off the loan and start borrowing again.

      3. How long does it take to get funding?

        You can get a business loan for up to Rs.30 lakh within 72 hours. The approval time may vary depending on the loan amount you apply for. Once your upload your documents. Once the documents are verified, your loan amount will be disbursed immediately.

        4. Do I need a business plan when applying for a business loan?

        Business loans from Bajaj Finserv do not require collateral. No need for co-signer or guarantor willing to guarantee the loan either. This is irrespective of whether you are a start-up business or are looking for a larger loan.

        6. I have some problems on my credit report from the past; will that work?

          We make sure that you are presently current on all your existing debt. We also check whether any negative remarks on your credit report from the past are at least a few years old.

          7. What security do I need to provide to obtain a Business loan?

            To obtain the loan, there is absolutely no need to provide any security or collateral.

            8. Can I apply for business loan if my credits are not good?
              Yes, you can apply for the business loan even with the bad credits and for that all you have to do is to give an assurance to bank that you’ll be able to repay the loan.

              9. How is a business loan to be repaid?
                All business loans are repaid through EMIs or equated monthly installments from the borrower’s bank account. The borrower or customer is required to either give PDCs or sign an ECS mandate in favour of the bank disbursing the loan.

                10. What is the maximum loan amount one can avail?
                  One can avail a small business loan of up to INR 1 crore. The calculation of the amount is basis your income and other parameters that may differ from bank to bank.

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