Business Loan
Business Loan is generally referred to unsecured short term loan for businesses. Although any loan availed by businesses for business purposes can be termed as a business loan but an unsecured variant of term loan is generally referred as Business Loan.
These types of loans of raised by the businesses for short term fund requirements and can be repaid back in EMIs spread over Maximum 3-4 years. These loans are called unsecured as no collateral of any form is required to secure the loan amount.
Such loans are granted purely on the basis of business performance, Vintage of the business/Promoter, end use of the loan amount, and the overall business comfort derived by the lending institutions.
These loans can be availed by individuals, MSMEs, business owners, entrepreneurs, retailers, traders, manufacturers, self-employed professionals (CAs/Doctors), and several other business entities.
Since these loans are unsecured in nature hence the rate of interest of such loans are on a higher side then the secured lending instruments. The maximum loan amount that can be availed is also defined by the lending institutions.
Since these loans are unsecured in nature hence the rate of interest of such loans are on a higher side then the secured lending instruments. The maximum loan amount that can be availed is also defined by the lending institutions.
General Eligibility Criterions for Availing An Unsecured Business Loan
- Business Vintage of company/firm should be 2 years or more.
- Turnover of the company/firm should be more than 20 lacs for the last two years.
- The business must have generated profit for a minimum of 1 year
- The main applicant should be minimum of 21 years of age & should be no older than 65 years at the time of loan maturity
- Good CIBIL score/history of the all the borrowers/Co-borrowers are generally sought.