- June 2, 2020
- Posted by: Ganeshcbani
- Category: Blog
When starting a new business, it can be difficult to come up with the money needed to get started. There are many options for obtaining a loan, but each has its own set of risks and costs. In this article, we’ll take you through the different loan options available to small businesses and explain the pros and cons of each.
Business Loan
With small-scale business loans of up to 50 lakh, financing is now just 24 hours away for your small company. Using funds to invest in facilities, extend activities, upgrade to new machinery and equipment, retain inventories or increasing working capital. These custom loans will improve your business to help your organization hit new heights with improved productivity and profitability.
Three Types of Business Loan
Loan for working capital
Money is the fuel that keeps the company running and the business will fail if you do not have the money available for day-to-day operations. Our working capital loan allows you to fulfill your financing criteria so that your regular activities can be carried out smoothly.
Loan for equipment
A organization should work like a well oiled machine and have working machinery and equipment for that. You can upgrade your current equipment or buy and rent the latest machines for your business by taking a Machinery Loan. This not only improves the overall efficiency, but also ensures quality output. Many businesses need to purchase, install, fix or upgrade various types of equipment. Equipment is costly and necessary to optimize output and profitability in industry. Unplanned costs, such as repairing or replacing broken equipment, can harm your budget. The business loan will give you the money you need at a quick pace to keep running the company optimally.
MSME & SME Loans
The cornerstones of our society and economy are micro and small and medium-sized enterprises. These companies offer primarily services which satisfy the community and have access to the right type of support to fuel their growth. If you are an MSME member, then we provide small business loans that will provide you and your company with the boost that you deserve.
Business Loan Used for
Expenditure
Growth is important for any business. Expansion will help to ensure that the earnings don’t fall as company booms. Business loans will help cover expansion expenses without reducing your operating funds so that you are able to track the development of your company.
Inventories
Inventory is every grocery, wholesale and seasonal business‘ lifeblood. When your company is operating, you will need capital to continually grow and refill your stock to keep up with demand and give your customers more options. A Business Loan will help you cover production costs and keep you up with trends and consumer demand without hurting your sales.
Cash Flow
Many companies face a cash flow challenge if the company is seasonal or whether you have clients not paying for services on time, or if you have unsold inventories to get in new goods. Cash flow is a challenge. This can impact your daily inventory, employee, utility, rental or mortgage costs. A corporate loan will help you handle your expense on a daily basis and keep your income small.
What are the basic requirements for the approval of the business loan?
We have ensured that obtaining a business loan is fast and easy. For swift consent:
Keep your personal details convenient like your PAN number, Adhaar number, CIBIL ranking
Keep your KYC business information ready, such as PAN Wallet, Corporate Registration.
Provide your paycheck, address evidence and bank statements for the past six months
Read more about eligibility for business loans and necessary documents.
Business Loan Eligibility
You are eligible for the company loan if you are 25-65 years old.
You will have a profitable company for three consecutive financial years
Your sales will demonstrate an upward trend
A registered Chartered Accountant must audit your balance sheet.
The documentation:
Here are the documents to be sent to seek a business loan:
Type of application duly filled out
Bank accounts of the organization over the last six months
Revenue tax returns for the past two years
Balance sheet and income and loss over the last two years
KYC Business papers include PAN Cards, Incorporation Registration, Partnership Act, Memoranda and Association Articles
KYC business owners’ documents
A study on the use of the company loan
Identity Proof
Your Business Loan application form with passport size photographs along with a copy of your Voter ID /Passport/Driving License/ Aadhaar card
Business Proof
Ownership documents
Sole Proprietorship Declaration or certified copy of Partnership Deed
Income Tax Returns along with computation for the last two years
P/L Profit/Loss statement and balance sheet for the last two years
Conclusion
Getting a business loan is not as difficult as many people think; in fact, with the right information and application process, you should be able to get approved relatively quickly. Before you start applying for financing, it is important that you have an understanding of your financial situation and what kind of loans are available to you. Make sure to consult with a financial advisor before submitting any applications so that they can help flesh out your business plan and ensure that your loan application meets all the necessary requirements. Good luck!
