30 Jun 2021 | 5 min read
One of the simplest ways to fill your hands with cash is a Business Loan. But there are several different lenders to choose from and dozens of loan types which makes the process highly challenging and complex. After delving deep into the sea of gigantic business loan offers, we narrowed them down to our top picks.
Funding a business is typically a challenging task. Here we've compiled the 10 best options for Business Loans, which we strongly believe that if you go through the entire post, one of them will fit perfectly to your needs and you will be able to achieve what you wish for your business! Let’s get started without any delay!
One of the best and general types of Business Loans is a term loan. The loan comes in both natures that are to say secured and unsecured. The quantum available counts on the credit history of the business. The tenure remains fixed which ranges from 1 year to 5 years in case of an unsecured business loan and can go up to 15 years to 20 years if secured in nature.
Typically, a term loan is mostly availed for a selected objective, generally to meet the daily cost of the business operations.
A start-up loan is mostly availed for the purpose of commencing new business ventures. Applicants for such loans might not have an excellent credit history on their company because of the scarcity of business vintage. Thereby, to evaluate the Business Loan eligibility, the lender will consider the personal credit profile alongside the corporate profile of the borrower.
The current turnover figures and other financial information are also taken into account to finalize the decision across the loan amount, loan tenure, and rate of interest applicable. The business should be established, and the applicant must submit proof of the business's existence and registration.
Working capital loans are types of small Business Loans that are availed for the purpose of beating the shortage of money to operate a business on a daily basis. It produces a balance in income necessary to drive a business. This loan additionally comes in handy to affect a shortfall of money during the off-season or meet demand during a high season.
The majority of eligible applicants for this sort of loan are wholesalers, retailers, service providers, manufacturers, or traders engaged in exports and imports.
Note: To figure out the monthly installment, you can also take the assistance of an Afinoz Smart Business Loan EMI Calculator available on our website.
This commercial financing is majorly rendered to the manufacturing businesses. Manufacturing units require costly equipment as they face its need so as to manage the operation of their business. And to get the machines, out of all the kinds of Business Loans, equipment financing stands at the forefront.
Equipment Financing Business Loan is specific in nature, wherein the equipment is taken as collateral alongside additional security. The rates of interest might be lower than those charged on term deposits.
An overdraft facility is extended against securities or collateral, particularly in terms of fixed deposits with the financial organization.
The lender evaluates the credit history of the borrower, its relationship with the institution, its business income, and its repayment history prior to approving a particular fixed overdraft limit. The borrower can take out an amount as needed and pay interest only on the utilized funds.
Some of the financial institutions extend special schemes on Business Loan for Women entrepreneurs. Even the Indian government took several initiatives in the past so as to encourage women in establishing small to medium-sized businesses. The benefit of specialized loans for women entrepreneurs comprises a versatile loan amount, start-up loan, discount on the rates of interest, and a quicker loan procedure.
While a business credit card does not stand out as the very first option that business owners may opt for in order to finance their requirements, yet, it’s great for a short-term and instant funding option.
If the business owner is in requirement of quick funds and simultaneously wishes to earn rewards against payments done on debt, then undoubtedly, a business credit card is an ideal option.
At Afinoz, we provide SME loans secured against property for businesses whose loan need surpasses Rs. 50 lakhs. Here, the applicant is required to mortgage his/her property to get the funds for business goals. The borrower can apply for funds against either a residential or commercial property.
Lenders associated with us can fund up to 70% of the present market rate of the property. Tenure of such loans ranges up to 20 years, counting on the terms and conditions set by the certain lending institution.
Invoice financing is referred to invoice discounting or invoice factoring. This sort of business funding is certainly for micro-businesses that encounter a delay between raising invoices and receiving payment from the clients.
The lender provides financing against the quantity raised within the invoice. The lender can provide funds of up to 80% of the total amount stated in the invoice. Once the business gets the payment, it clears off the debt according to the decided term and rate of interest.
The lender extends an advance of capital on some of the daily open-end credit sales or credit. The borrower has got to then pay off the advance with some of the daily credit sales. The borrower must ensure that s/he’s adequate income to manage the payments.
The benefit of merchant advance is that the person has got to pay in accordance with the daily sales. So, if the business is low, the quantity to return is low, and when the business is high, the quantity to repay is more.
To conclude, a Business Loan is an easy way to finance a business and often stands out as the best way to get cash quickly. If you’re responsible with money and believe that you can pay back what you owe, you can safely consider getting a Business Loan. Moreover, you can consider the type of Business Loan as per your needs and circumstances not only to be precise but you can also save considerably on Business Loans made for specific purposes.
Looking for Business Loans at the best interest rates for your business? Let Afinoz be your helping hand! We help you not only getting your best interest rate but also let you compare multiple offers and save a lot more on other factors. To apply for the best Business Loan.