What is a Business Loan?
Are you looking to expand the business and searching for the financial support from someone? A Business Loan offers much needed relief and financial support to cover up the demands and needs.
Business loan is one of the best way to increase the financial support for various business needs of yours. The business loan is a way to seek a helping hand to make your business climb the ladders of success. Business loans are the ways to the loan offer with and without any collateral depending upon the conditions of the banks and financial institutions. The money is credited into the bank account with the certain rate of interest being charged and with the tenure fixed for the purpose of repayment.
Purpose of the Business loan
The business loan can be used for various purposes depending upon the needs and demands of the business owner. The various needs of the business loan can vary from the expansion of the existing business to the implementation and brining in new facilities/services in the business. It can be used to start a business as a fresh beginning. Depending upon the needs of the business, the loan amount is approved. Here are the purposes of the Business Loans:
For the expansion of the business
Expansion of the wings/services in the business
To establish a new business
Machinery / equipment purchase for the business
For the purpose of bringing new talents in the business
Different types of Business Loans
With business loans, covering up various needs and demands of the entrepreneurship, there are certain defined types of the business loans, which are mentioned below:
A term loan is the business loan type, which you need to pay back in addition to the interest over a defined set term. In the category of Business Term Loan, you have the spectrum of scoring low cost, long term loans from the lending agency.
Short Term Loans
Short term loans are the business loans which are just like regular term loans, but with the difference that they need to be paid back in shorter terms. The short term loans come with the 3 to 18 months of loan tenure.
A low cost SBA Loan, having the flexible term loans, which are offered by several online lenders and traditional banks. These SBA Loans are secured by the Small Business Administration and are thus named as “SBA Loans”.
Business Line of Credit
To fulfill any sort of need for Business, all traditional banks and online lenders offer revolving lines of credit, thus offering you a helping hand to cover up the costing needs of the business.
The equipment financing is the business loan, which can be used to buy equipments and other machinery for the business. The equipment financing is the business loan type, where the collateral is the machinery or the equipments itself (which you bought). Isn’t it the best part of the Equipment Financing?
Invoice Financing is the business loan type, where the finance facility is available on the basis of outstanding invoices. Under the invoice financing, the finance facility of around 85% of the outstanding invoice is being offered and a charge as a factor fee is levied each week, in case when the invoice goes unpaid.
Business Credit Cards
Business Credit Cards are somehow a sort of Business loans, where the business credit card can be used to finance the needs and demands of the business. Under this Business credit cards scheme, you can have a separate business and personal finances and can build business credit and even can earn valuable rewards and other cash back offers.
Merchant Cash Advances
Merchant cash Advances are the sort of fast cash, which needs to be paid with the business’s daily debit and credit sales. It can be considered as the good options, in case you have the poor credit. The Merchant cash advances are considered as the most expensive financing option available in the entire market.
Different Business Loans varieties as offered
In India, you can get Business loans of various kinds. Even, more recently the government’s emphasis on encouraging the entrepreneurship has opened new doors to the people looking for the business loan to either open startups or to carry out the various functioning of business. Here are some Business loan types in the broader category:
Business loans for startups / new businesses
Many aspiring entrepreneurs, who are planning for a new beginning of a career with the new businesses or a startup, have the chance to the business loans. The banks and other lending agencies offer business loans to the people who are looking for either the startups or for setting up a new business. In the past 2-3 years, the scope of such loans has gained a strong foothold with the government motivating your people towards the entrepreneurship. Several schemes and offers are a part of the lending agencies for such type of loans.
Business loans for Women Entrepreneurs
Women are encouraged to the self dependent and in an effort to motivate women towards this approach; several banks and lending agencies offer business loans for this purpose. The fact that the number of the business owned by the women has increased with an unprecedented pace, the need to support them in the best way has pushed the policy of the business loans for women entrepreneurship.
In a way, the business loans for this purpose have not only supported women, but at the same time have pushed the economic growth of the country to a greater pace and also has created a huge number of jobs for the people of the country. Under the schemes list meant for the women, few of them are Annapurna scheme, Dena Shakti scheme, Cent Kalyani Scheme, Mahila Udyam Nidhi Scheme and several others.
Business Loans for Bad Credit
In case you are suffering because of bad credit, you are still at luck to avail business loans. There are several banks, which offer business loans to the people who are having bad credit score. With certain conditions in the form of the revenue statement, the type of the business you own, loan requirement and the asset of the business to be pledged, a person has a chance to get the business loan.
Business Loans for Expansion / Working Credit
Are you looking for the business expansion? Are you of the opinion that the expansion is on the cards and the business have enough chance to gather feathers through the expansion policy? In case, you are looking for the funding for the expansion of your business; you have the chance to avail business loans under this category. With the good credit score, business revenue details and all other documents in support of the business and its expansion, you are sure to have a chance to avail the business loan under the category of “Business loans for expansion/working credit”.
Benefits of the Business Loans
The business loan offer several advantages when it comes to the business:
Business loans offer a helping hand to the business for the expansion
Business loans come to the rescue to the people, who are planning for startups
These business loans are a way to add new dimension to the business
These are helpful during the most precarious times of the financial need for short term
These are helpful in managing the demands of the employees of the company and for carrying out several other important operations within the company
Business Loans are the way to tax savings. With business loans, the owners can enjoy the tax benefits.
The business loans offer several other benefits in terms of personalized services in future. With the business loans and other such loans, the credibility is built and trust pays in the future for various other personalized services.
The business loans help in building a better CIBIL Score.
The business loans are of various nature and thus with the numerous options the business owner can make a choice depending upon the needs and best offers.
The banks don’t get involved in the business money and have nothing to do with the internal affairs of the business. All are they concerned with is the interest on Business loans and the partial loan payment installments.
Eligibility for Business Loans
To apply for the business loans, the following must be the eligibility criteria for the borrowers:
The borrower must be the owner of the business
The borrower must have the startup in mind
The people looking for the business loans must have the proper documents in support of the business
Since the business loans are of different types, in case of ‘Business loans for machinery purchase’, the borrower must show the adequate paper in support for the task.
The business owner must have filed in tax returns for at least two years. (However, in some cases, there are some lenders, who are more than happy to lend the business loans to the people, with less than two years’ tax returns.
Pre – Requisites of the Business loans in India
There are some pre-requisites of the business loans in India, which are mentioned below:
Good Personal Credit
One of the most important prerequisites for a business loan and all types of loans is the credit score of the applicant. The credit score plays an important role in the decision of whether to approve the loan applicant or to deny it (however, when it concerns business loans, there are several conditions, when credit score is overlooked). However, the better is the credit score, the more is the trust in front of the banks and the more is the eligible the applicant is.
Good Business Credit
The more is the number of years the business is in operations; the better is the chance of the approval of the business loans. You must keep a fact in mind that for an existing business, the factors like years of operations, the credit worthiness, the revenue pattern etc are considered as important elements.
Solid Business Plan
In case, the business is not present and Business loan is being required for a startup, the solid business plan is one factor, which the banks look towards. Having the blue print of the business plan will be legally considered and will be considered as an element to be considered before approval for the business loans.
The more is the collateral to be put to the banks for the business loans, the more is ease in getting the business loans. The lesser is the risk the banks feel, the faster will be the processing of Business Loans by the banks in India.
Another pre-requisite, which the banks look towards, is the industry experience. Keep a fact in mind, the lesser is the industry experience; the less is the chance of the approval of the business loans for you. Having an adequate knowledge and experience of the business and industry concerned, the person has the best chance to get the business loans approved by the banks.
Documents Requirement for Business Loans
Below mentioned is the list of documents required for the business loans:
Address Proof of the applicant
Bank Statement for last 6 months
Proof of Business
Proof of identity of the applicant
ITR and statement of income
Board Resolution (if it does matter) or authorization
CA Certified PL Account statements
Balance sheets for last 2 years
Ownership of the proof of residence or office
Role of DealsofLoan
So, you must be asking a question to yourself? What role does DealsofLoan play in the business loans? If, there are all banks and lending agencies present in the outside market with the business loans in hands to offer you, what importance does DealsofLoan play here?
In fact, there is no dearth of options for you, when it comes to the business loans of various natures. There are several lending agencies and banks that are ready to offer you business loans. But, are you knowledgeable enough to compare which banks and lending agencies offer you the best deal? Are you in a position to prepare a chart on your own to compare the offers and deals of the various loan providers and chose the best?
Thus, for the motive to guide you in the best way for the best comparison for various business loans at offer through different loan providers, the DealsofLoan guide you on each step. The DealsofLoan offers a single platform, where all deals and offers are at a single place and you can compare all the loans in the most convenient way.
The DealsofLoan offer the complete guide of what kind of loans suits you and what is needed for the chosen type of business loans. It helps you in making the best choice and also offers a helping hand to quickly avail the business loans of all kinds.
Steps to Avail the Right Business Loans in India
Here, the DealsofLoan present important steps on how to proceed for the right business loans in India:
Start with the choice of the type of Business Loans you require
Draw an estimate of how much loan is required
Collect all information regarding the documents required for the chosen business loan type
Go through the expert tips like DealsofLoan tips and tricks and guidance for the final list of documents required
Check and compare the offers by different banks
Go through the interest rates and other charges as offered by several banks
Make a choice of the banks and for your convenience, make a shortlist of 3 banks in preference order
Call the bank representatives and have an appointment fixed
Clear all your doubts and queries
Complete the application process and apply for a business loan
Do’s and Don’ts of Business Loans
There are always some do’s and don’ts, which you should follow in the process of your loans of any kinds. When it comes to applying for the business loans, which is utmost important concerning your and your family future, things must be done with utmost care. Here are few do’s and don’ts, which you should look at:
Go for the complete documentation process, and submit all needed necessary documents to avoid rejection of your business loan application
Whenever you go for the meeting for your business loan, carry with you all original documents like revenue slips, documents in support of business, ITRs etc.
Keep a close look at the credit score of yours if you are planning for the business loans in near future
Don’t rush in for too many applications of business loans at various banks
Try to close off all your debts in order to feel better and free
Ensure that the payments are made clear for all your debt obligations
Have a discussion on the interest rates on Business loans and try to get it as low as possible
Several important facts should not be discussed with the representatives of the banks. Check well in advance these requirements and details on your own
Don’t make huge purchase/ don’t apply for big business loans
Never change the name of the company during the last moment as the chance of the rejection of the business loan application goes high
Never rush in for the closure of the loan process
Never sign in any documents without going through the complete papers and reading the terms and conditions
Business Loans Online in India
With the fast changing technology and rapid transition in the way the country works, the banks have gone, the online way. Now, there is no dearth of options for the lending agencies and banks, which offer the business loan online. With the safe and secure methods of applying for the Business loans Online in India, by just giving the few basic details about you, you can quite easily initiate the process of the Business Loan application through the chosen bank. All you need is to enter a few details and the process soon begins with the representative contacting you directly to the given contact number and getting an appointment fixed.
Business Loans and DealsofLoan
With the DealsofLoan actively involved in all kinds of the loans, the company looks forward in helping the customers in all possible manners. The Company offers a genuine platform, through which, the needy can initiate the necessary process for the loan. The DealsofLoan offers the complete guide on how to approach for loans either it is Business Loans or any other kinds of Loans.
With best loan offers and the super fast services, the company assures you that the best support will be offered in your fight for the quick and easy Business Loans in India. With the effortless guidance through us, you are assured that you no longer have to wait for the bank’s decision on the approval; or disapproval of the Business loan Application; we ensure that you will be offered the Business loan in the quickest and easiest way at the best interest rate.
The DealsofLoan is a service provider, which ensures that the customer gets hassle free services for their loan requirements. Proving to be helpful in various ways; either it is improving the bad credit or in guiding you towards the easiest way for your needs, the Company ensures that the services through them reaches to the maximum and providing the customer the much needed helping hand during the financial need.
All you need is to contact us to get your troubles get resolved within a matter of a few hours. We are waiting to help you and are at a distance of few clicks of a mouse!
The best loan platform in India is waiting for you!