Business Loans are the most common source of credit for business needs. These loans can be both secured and unsecured. Unsecured loans are being referred by most business owners as they are available with minimal documentation and flexible repayment terms.
Their accessibility has increased, too, with new-age NBFCs like Clix Capital, making it easier for entrepreneurs to apply for Business Loans online.
Why do companies take Business Loans?
Different companies have different credit requirements. Entrepreneurs may apply for unsecured Business Loans, such as Term Loans and Working Capital Loans. They can even apply for secured Business Loans or Loan Against Property. These loans can be used to add inventory, research or add manpower to your business.
Business Loans can help your company in many ways, but failing to repay the loan instalments on time can affect a company’s credit rating. So, do check your credit scores from time to time and try to improve them if needed before applying for a business loan.
Read on to understand how to avail of instant Business Loans in India.
Benefits of Online Business Loans
One of the main advantages of applying for a Business Loan online is transparency. You can understand the terms and conditions associated with the loan product before applying. The loan eligibility criteria are simple and hassle-free, so borrowers can expect quicker approvals.
- Credit Rating: A Business Loan requires a CMR score of up to 6 and a CIBIL score of 700 and above to be eligible for the loan application approval.
- Loan Products: Online Business Loan products include working capital loans, machine loans, and term loans designed to meet the diverse and unique needs of small business owners. Business Loan interest rate calculators also help applicants to know their future EMIs.
- Processing Time: Online Business Loans can take a few days to process.
Eligibility Criteria for Online Business Loans
While every NBFC has their eligibility criteria, Clix Capital has one of the easiest application and approval criteria for Business Loans. We have listed it below to help you understand what NBFCs look for while giving out loans.
- The business should be in operation for the last three years.
- The minimum turnover of the business should be INR 1 crore.
- The applicant must be 21 years of age or older at the time the loan is disbursed and must not be over 65 years of age at the time the loan matures.
- The business should have a CMR score of up to 6 and a CIBIL score of 700 and above.
- The applicant can avail of a loan ranging from 5 to 50 lakhs depending on their eligibility.
- The business owner is not required to provide any collateral security.
- The business should be a proprietorship/private limited company/closely held non-listed company/partnership firm involved in manufacturing, trading or services to get loan approval.
- The tenure may range from 12 months to 48 months.
Procedure to Apply for a Business Loan Online
Entrepreneurs can apply for a Business Loan online with simple steps.
- Visit a reliable NBFC’s website (for example – Clix Capital)
- Go to the Business Loan section and register with your mobile number
- Provide your name, email, pin code and the amount required
- Submit the form with the OTP received
After submission, you will get a call from the NBFC’s customer care for proceedings. Once the verifications and formalities are completed, the amount is disbursed into your account quickly.
Important Requirements of Online Business Loans
- Mention the nature of your business
Declare the nature of your business to the loan provider (a proprietorship/private limited company/closely held non-listed company/ partnership firm involved in manufacturing, trading or services). Apart from that, some lending institutions may also require business turnover details, profit and loss statements, and a summary of business owner details. Therefore, it is recommended to understand the eligibility and documentation criteria before proceeding.
- Be clear about your funding needs
Have an estimate about the financing you need. Invisible costs can appear out of nowhere. In such cases, a flexible loan without strict guidelines, which is readily available, is the best option. If you are looking for legitimate financing for your business, applying to online NBFCs like Clix Capital is a great option.
- Ability to Repay Lenders
In addition to a borrower’s willingness to repay, lending institutions are also concerned with their ability to repay. While verifying the applicant’s documents, they review the borrower’s business to determine if there is sufficient liquidity to make payments and continue the business.
Business Loan interest rate calculators are also a useful tool to find out your Loan EMI amount before applying for a Business Loan.
- Conditions
Environmental and economic conditions are beyond the borrower’s control, but some lending institutions consider these factors. They analyse how these factors affect the borrower’s business as part of lending decisions. So, they may look at consumer trends to assess whether they may affect the future success of the borrower’s business or not.
Takeaway
As a small business owner, you may need funds at some point. A Business Loan can be a good option. However, choosing the right moneylender is very important. The trick to doing this is first to research the loan providers and NBFCs in the market, the types of loans they offer, their eligibility criteria, other terms and conditions, and the interest rates they charge. It is time for you to analyse your needs and eligibility before you apply for a Business Loan.
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