GET BUSINESS LOAN AT CHEAPEST INTEREST RATE
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What is Business Loan
Business Loans are unsecured loan provided by Banks & NBFCs to support business of the people. It’s a credit facility provided by Banks to fund a startup expenses or expansion of existing business. There are different types of business loans used for different kinds of needs of different businesses such as Working Capital Loan, Business Term Loan, Startup Loan, E-Commerce Business Loan, Invoice Financing Equipment Financing, Overdraft etc
BENEFITS OF BUSINESS LOANS
Business Loans as compare to other loans has its own features and benefits
Interest is Tax Deductible
Interest which you pay on business loan is tax deductible. Since it is an additional amount paid by you to the bank which is paid out from your profit or income, it is eligible for a tax benefits.
Minimal Documentation
Unlike other loans, to get business loan you don’t need much documents to get the loan therefore it is easier and quick to get the business loan. Moreover, some banks offer door step services also.
Competitive Interest Rate
Since there is intense competition among banks to grow their own business, the interest rates are quite reasonable but interest rates may vary customer to customer basis depends upon credit worthiness, tenure and the purpose for which the loan is needed.
Collateral Free Loan
The Business Loan is an unsecured loan which means that the borrower does not have to provide any security or guarantee documents to the lenders but the property or land must be owned by the borrower to get 100 percent loan disbursement.
Business Loan Eligibility
Every Bank or NBFC providing business loan have different eligibility requirement and needs. Still there are some common criteria for all the Banks & NBFCs. Before applying it is advisable to check eligibility on Eligibility Calculator.
1. The applicant should be at least 21 years of age at the time of applying for loan & not older than 65 yrs of age at the time of loan maturity
2. The business should show profits in the past two financial years.
3. The business should have a minimum annual income of 1.5 lacs per annum
4. All financial documents like Profit and Loss Account, Balance Sheets and Computation of Income Statement should be audited by registered Chartered Accountant
Business Loan (Documents Required)
- Photo ID Proof - Pan, Driving License, Passport & Voter ID
- Address Proof- Aadhar, Passport, Driving License, Voter ID, Utility Bills (Electricity Bill, Water Bill & Mobile Postpaid Bill) and Rent Agreement
- Bank Statement (Latest 6 Months) - Business Account, Current Account & Cash Credit Account
- Proof of Business - 1. Incorporation Certificate, MOA, AOA for Private Limited Companies. 2. Sole Proprietorship or Partnership Deed for Partnership Firm. 3. Shop or Establishment Certificate of your Business.
- Financial Documents of Business - Audited ITR, Computation of Income Statements, Balance Sheet, Profit and Loss Account, Tax Audit Report & Trading Account of Last 2 Years.
Points to Compare while applying Business Loan
Compare Interest Rates
It is always good to compare the offers of various Banks and NBFCs before you settle for one. Check and compare the interest rates on personal loan offered by various Banks and NBFCs to get the best and cheapest interest rates on LoanPakka.Com. Most Banks offer completely fixed rate of interest for the entire tenure of the loan. Make sure that the personal loan that you are taking is also fixed for the entire tenure.
Compare Processing Fees
Compare various banks processing fees on the business loan they offer. Most of the banks have processing fees ranging from 0.5 % to 3 % of the loan amount. Higher processing fees can result in significantly high cost on loan hence, it is important to compare rates for business loan on LoanPakka.Com and select the best offer.
Insurance Premium
Some Banks may request you to get the insurance policy as it is an unsecured loan. Get the insurance policy which gives you adequate coverage at lowest premium.
Compare Prepayment and Foreclosure Charges
Everyone wants to repay his loan as soon as possible. Sometimes, you want to repay part of the loan i.e. part prepayment or you may want to repay entire loan amount before tenure. Banks levy prepayment or foreclosure charges ranging from Nil to 5 %. Hence, it is important to compare prepayment and foreclosure charges of various banks on LoanPakka.Com
FREQUENTLY ASKED QUESTIONS ON BUSINESS LOAN
Generally, processing fees for the business loan is 1-3 percent of loan amount
Some banks allow pre closure at no cost and Some banks levy pre closure charges between 2 to 5 percent of loan amount.
The Tenure of the business loan may vary from period of 01 month to 60 months
EMI can be made on a biweekly or monthly basis
Generally, the minimum amount is 50 thousand rupees and maximum loan amount is 2 Crore rupees which may be extended depends upon customer profile.