A loan for traders without security can be used to grow sales and increase profits. A loan for traders without collateral is the best option for small traders. This type of loan is offered without collateral and therefore, they are not required to hypothecate an asset. However, the difference between an unsecured business loan and secured one is not just the requirement for collateral.
There are some other major differences between them as well. The other important difference being the lender. Collateral or secured business loan for traders and shopkeepers is offered by traditional lenders such as banks. And the unsecured or collateral-free loan for traders are generally offered by Fintech lenders, such as NBFCs.
So, if you are looking forward to availing a business loan for traders without any collateral, you must look forward to availing it from an online lender. That said, you can follow the following steps to avail a loan for traders without security from an NBFC:
The first step for availing a loan for retail traders is to apply for a loan. The NBFCs have online loan application process. So, you are not required to visit their office to apply for a loan for traders without security. All you have to do is to visit the lender’s website.
The loan for small traders can be availed by filling the loan application form available on the website. In addition, you can also download the mobile application of the lender to apply for a loan for traders without security directly from your mobile phone.
The trader’s loan eligibility is the criteria upon which the lender sanctions the loan for traders. The eligibility criteria of every lender are different. It is important to check the eligibility criteria before applying for a loan in order to ensure that the loan application is approved.
The basic eligibility criteria laid by almost every lender is the following:
- Turnover of the business must be INR 10 Lakhs minimum in the last 12 months.
- The last year ITR filed by the business must be more than INR 2.5 Lakhs.
- Either house or business premise should be owned by the business owner.
- The business place should be separate from the residence of the business owner.
- The business vintage (operations) should be at least 2 years.
The documents are required as proof for business loan eligibility. The loan for share traders are offered by many NBFCs in India and each of them has different documents requirements. The usual documents required for a loan for traders without security are as follows:
- PAN card
- Identity proof
- Address proof
- Business place address proof
- 2-4 photographs
Notably, all the documents can be uploaded on the website of the lender. However, you are suggested to upload the PDFs of the documents as it will make it easy for the lender to process your application. Also, all the address proof, such as utility bills must be the latest.
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After you apply for a loan and submit all the documents, the lender will process your application. He will check if you meet their eligibility criteria and if all your documents are in place. And if everything seems well, the loan application will be approved. Notably, NBFCs do not take a lot of time to process and approve the loan application.
The NBFC business loan is generally disbursed within a few days. The money availed under the loan can be used to improve products and services. So, it is important to apply for an NBFC loan for traders since it is sanctioned and disbursed within a few working days.