There comes a time for every business when you need to raise debt for efficient and smooth business operations. These funds help the business owner to expand, invest and meet its working capital needs. At times like these, a business loan can be the best financial help that a promoter can get.
This borrowed amount can be spent towards daily capital expenses, specific project funding, and expansion of the business including purchasing of new machinery for the business. You can also apply for a business loan if you need investment for starting a new business or ancillary units for your existing business.
Grow your business with Business Loans from Afinoz. We provide you with a number of options in business loans from different banks and NBFCs. Now you can easily avail business loans through Afinoz without any hassles. We are always with you to help build your business.
Features & Benefits of Business Loans
- Loan amount can be from Rs.3 lakhs onwards
- Simple and easy documentation process
- Tenure for business loans can be from 12 months to 48 months
- Business loan interest rates vary from 17% to 25%and depend on the eligibility of the applicant and the quality of business
Advantages of availing business loan from Banks:
Accessible and Convenient –It is an essential aspect. In normal course, we visit banks for various works & have conversations with them. This specific familiarization with a bank helps in having personalized services.
Multiple Loan Options – All banks promote various types of loan schemes to encourage business setups. Some of options offered are standard business loans, term loans, and others as per the need.
Non Profit Sharing – Angel investors and venture capitalists agree to provide a loan or investment in the business with the agreement of having part ownership on the business, therefore they will get the right to powers of the business and in decision makings. Also they will share the profits of the business along with the business owners. On the other hand, banks don’t put their hands into business money; everything you earned profit through your business is all yours. There is no share of profits or loss. Banks sanction a loan with the intention of getting their interest and loan-payment installments.
Lower Rates of Interest – Interest rates offered by banks are lower as compared to those offered by other lending institutions (NBFCs)
Business Loans Offer Tax Benefits – Businesses opting for bank loans enjoy tax shield. The interest repaid on such loans is deducted from profits before calculating the tax payable to the Government. Before finally zeroing in on a bank or NBFC, please ensure that you have compared their offerings in terms of interest rates, method of interest calculation, processing fee and other charges, eligibility criteria, type of security required, for closure charges, etc.
To avoid all the hassles, you can simply visit our online user-friendly portal afinoz.com through which you can get the loan quickly. We, at afinoz, ensure that you get the best offers, instant approval, lowest interest rates and easy disbursal of your loan. Be it any advice or help regarding personal loan process, you can contact us at +91-8795021552 or email us at email@example.com and we will be glad to help you. You will find that afinoz is the greatest option to meet your needs. You will realize that afinoz is not only here to help you through the difficult financial time you may be experiencing as of now, but also that we jointly set you on the path to a more stable financial future.
Business loan eligibility criteria & documents required
A business loan can be availed with or without providing a security or collateral and depends on the bank and the amount of risk they are ready to take. It also depends upon whether the loan is for an existing business or to start a new one. There are many banks & NBFCs in India that offer loans for both small and big businesses. Getting approval & disbursal is possible within a few days if you have all essential documents and if you meet the eligibility criteria. Given below is the list of eligibility criteria to apply for a business loan in India.
Eligibility Criteria for Different Employment Types
Limited or Private Limited Company
Net income of the applicant or concern should be more than Rs. 150,000 per annum for a business loan of up to Rs. 1.5 million and over Rs. 300,000 for business loan above Rs. 1.5 million.
Chartered Accountant / Self Employed Professional
Anyone who possesses a diploma or degree in any of these disciplines can apply for a business loan; Arts/Engineering /Professionals e.g. Dental Surgeons, Accountants, Medical Practitioners, Engineers, Craftsmen, Management consultants, Construction contractors etc.
Factors Deciding Business Loan Eligibility
To be eligible for a business loan, there are lots of factors that are to be considered. Every bank or lending institution that offers you a loan will look into many criteria prior to sanctioning it. Few important ones are provided below:
Age Limit: The loan applicant should be of a minimum of 21 years & max. 65 years.
Income: Business should be profit making at least for the past 2 years.
Turnover: Rs. 150,000 per annum should be the minimum annual turnover.
Co-applicants: Co-applicants are optional and are not compulsorily required in case of a business loan.
Customer Profiles that lending institutions consider for Business Loans
There are different types of customers for business loans. Some are individuals who are self-employed or salaried and others are entities and companies. A large bank will cater to both types of customers. The eligibility criteria, interest rates, processing charges, tenure and other features extended by a bank will vary from customer to customer. Therefore while applying for a business loan, check which category of customers you belong to and accordingly check your eligibility.
Self Employed Professionals are generally Chartered accountants, doctors, company secretaries, architects and designers etc. who have their own practice. The other category is Self-Employed Non-Professionals such as manufacturers and traders. Their eligibility criteria, documentation, interest rates offered, and loan tenure offered are different as compared self-employed professionals.
Entities - Limited Liability Partnership, Partnerships firms, Private Limited and closely-held Limited companies fall under this category. This even includes banks and NBFCs who are looking to raise funds from larger banks or NBFCs.
All other types of customers and entities are decided on a case to case basis by banks & NBFCs.
Business Loan Documents Required
A business loan is one of the best possible tools to manage cash flow, spend additionally on capex and meet working capital gap. Each bank has its own specific set of requirements, criteria and eligibility factors. Here is a general list of documents and information required from you to process your loan:
|Sr. No.||Document Name||Details|
|1.||Application Form||All fields should be duly filled in and acknowledgment is given to the customer|
|2.||Self-attested copy of KYC Documents||Entity proof – Partnership deed/Certificate of Incorporation/Shops and Establishment certificate.|
Copy of PAN Card of Entity, Proprietors/Partners/Directors, Security providers and guarantors.
Address Proof of Entity, Proprietors/Partners/Directors, Security providers and guarantors.
|3.||Financials||Last 3 years Audited/Provisional Financials (Audited financials to include Balance Sheet, Profit and Loss Account along with schedules and Notes to Accounts, Tax audit reports, Statutory Audit report). In case of Provisional financials, VAT returns are also required.|
Current year performance and projected turnover on letterhead of the entity.
Last 1-year Income Tax returns of the borrowing entity (along with Computation of Income and copy of acknowledgment), if filed online, acknowledgment number is required.
|4.||Bank Statements (not more than 45 days old)||Latest Bank Statements for last 6 months (in case of First Time Borrower) and 12 months (in case of Takeover proposals). In case of multiple banks, statements’ covering minimum 75% of banking turnover is to be provided.|
Apply for business loan online with AFINOZ.com. You can call us at +91-8795021552 or email at firstname.lastname@example.org . You can check your eligibility & EMI for a business loan using our utility tools like business loan eligibility calculator and business loan EMI calculator . We ensure you of our best services. Once you submit a business loan application through Afinoz, you can effortlessly track your loan application status on our website.
Interest rate charged by a bank on your business loan depends on many factors. At the macro-economic level, it depends upon the credit policy being practiced by RBI which is a function of the health of the economy. It depends upon the GDP growth rate, inflation, foreign exchange reserves, fiscal and monetary policy of the Central Government etc. At the company level it depends upon the health of your firm i.e. annual turnover and profitability amongst other factors? Have they been growing, decreasing or been stagnant for the past few years? What is the amount you are looking to raise as debt? For how many years are you planning to avail it for? How is the promoter’s credit history? Has he / she ever defaulted on any debt, credit card payments etc.?
We, at Afinoz, can assure you that we will get you the best interest rate possible out there considering all the above factors.
|S.N||BANK NAME||RATE OF INTEREST||PROCESSING CHARGE|
|1.||HDFC Limited||15.50 % to 18.30%||Up to 2% of loan amount+GST|
|2.||ICICI Bank||15.50% TO 18.50%||Up to 2% of loan amount + GST|
|3.||Bank Of Baroda||14.10%||UP TO 2% of the loan amount|
|4.||Axis Bank||13% to 18.5%||Up to 2% of loan amount + Service Tax|
|5.||TATA capital||18% to 24%||Up to 2.5% of the loan amount|
|6.||RBL bank||20% to 22%||3% of loan amount|
|7.||Indusind bank||18.5% to 19.5%||2% of the loan amount|
|8.||Kotak Mahindra||18% to 19.5%||2% of the loan amount|
|9.||Fullerton india||16% to 33.5%||2% of the loan amount|
|10.||Bajaj Finserv||16% to 35%||Up to 2% of the loan amount|
|11.||IIFL||18% to 25%||3% of the loan amount|
|12.||MUFIN Finance||13% to 22%||2% of the loan amount|
|13.||Incred Finance||18%||3% to 5% of the loan amount|
|14.||Prest loan||18% to 26%||2% of the loan amount|
|15.||LendingKart||18% to 28%||2% of the loan amount|
|16.||HDB Bank||18% to 20%||Up to 2% of the loan amount|
|17.||Aditya Birla Finance||18% to 24%||2% of the loan amount|
|18.||Vistaar Finance||18% to 26%||2% of the loan amount|
|19.||Neo Growth||18% to 24%||2% of the loan amount|
Disclaimer: *Rates are subject to periodic change Business loan interest rates & other fees and charges are subject to regular review and can vary with each customer. These can differ depending on your credit worthiness & other factors. The final interest rate will be based on different criteria including the bank’s internal policies & applicable rates at the time of approval. Please note that the interest rates provided here are based on the market research. To facilitate the comparison insight, certain set of data has been reorganized/restructured/tabulated. It is advisable to recheck the same with the individual companies / organizations. This website does not take any responsibility for any sudden or uninformed changes in interest rates. Banks or Financial Institutions can contact us at email@example.com for inclusions or updates. For any further query, please contact us at +91-8795021552 or e-mail us at firstname.lastname@example.org.
Reply- Business loan is an unsecured form of loan provided by banks and NBFCs (Non-Banking Finance Companies). Unsecured means that banks do not ask for any collateral or a guarantor for sanctioning it. Entities like proprietorship firms, partnership firms; private or public limited companies are eligible for this type of loans. The end use of the loan amount is left to the borrower’s discretion and can be used for working capital purposes, meeting short-term cash flow requirements, investments into plant and machinery etc.Query-What is the minimum and maximum loan limit for a business loan?
Reply- The minimum loan amount offered is INR 100,000. This may go up to a maximum of INR 40, 00,000. Higher loan amounts are possible but these are considered after an in-depth discussion between the borrower and the lending institution and a more detailed due diligence.Query-How much time does it take to disburse the business loan?
Reply- Afinoz will work with the concerned bank or NBFC and get you the loan within 5 to 7 working days of your submitting all the documents.Query-What is the minimum amount of security that needs to be provided for availing the term loan?
Reply- It depends from case to case and such requirements will be explained to you by the sales officer at the time of applying for the loan.Query-What is the minimum turnover needed for the Business Installment Loan?
Reply- The minimum turnover needed is INR 4 million to get a business loan.Query-For which type of entities is the Business Installment Loan most useful?
Reply- Business Installment Loan mainly targets proprietorships, partnership firms, private limited companies and professionals.Query-Is any collateral or additional security required for availing this loan?
Reply- NoQuery-Is pre-closure allowed in business loans?
Reply- Some banks& NBFCs have a lock-in-period of six months to one year for a business loan. Whereas some institutions even allow pre-closure right after the first EMI has been paid. Some banks or NBFCs restrict the borrower from foreclosing the loan by transferring the loan to another bank or NBFC. However, the borrower may foreclose the loan from his own funds in such cases. Some banks allow fore-closure without any charge while some others charge an upfront fee of 2 to 5% of the outstanding balance. Clarifications on this are to be sought from our business loan advisor during the processing of your business loan.Query-Is part payment allowed on a business loan?
Reply- Some lending institution may allow part payment while some others may have restrictions on how many times in a year you can pay partially. Banks generally also have guidelines on the minimum and maximum amounts that can be paid partially. Clarification should be sought from our loan advisor during processing of the loan regarding this.Query-How is a business loan repaid?
Reply- 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 (Post-Dated Cheques) or sign an ECS (Electronic Clearing Service) mandate in favor of the bank disbursing the loan.Query-What happens if the ECS bounces or I miss an EMI payment?
Reply- The bank will levy ECS bounce charges. This will also get reported in your credit report. It depends upon the severity and the regularity of the miss; it will affect your credit score and will negatively impact your prospects of getting a loan in future. In addition to this, banks may also take legal action against the borrower.Query-What is the rate of interest & processing fee on business loans?
Reply- The interest rate varies from 16% to 23%. The processing fee charged up to 2.5% of the loan amount. Moreover, some banks may also insist on insurance cover.For any further query, please contact us at +92-8795021552, or email us at email@example.com .