As a business loan is a type of financing, it helps you in meeting the instant financial requirements of your expanding business. If you require funding to enlarge your existing business, buy tools, or uplift production, numerous lenders are offering great deals of an instant business loan. The size of the business or nature doesn’t matter when it comes to being ambitious enough and continuously search for funds to leverage changes for development.
Role of Small Business Loans
- Loans offered to small businesses for different motives by a lender or NBFCs is known as a small business loan. These types of loans have minimum restrictive needs, allowing the small business to secure the funds. It may also provide other incentives for the borrower that can lessen expenses for your business.
- These loans are customized to provide your business with a much-required raise to assist your firm scale in reaching new heights with improved profitability and competitiveness. Employ financing at enticing interest rates, borrow capital without putting any assets, and acquire access to credit that you can repay over a specified period.
Before you apply for a quick business loan, you should look for things like instant access to funds, minimal paperwork, flexible repayment terms, and modest interest rate. As every business is different, its nature, terms, and conditions for loans across the businesses also differ broadly.
What is an Unsecured Business Loan?
- An unsecured business loan is a kind of small business loan in which you don’t need to offer collateral or put any belongings as security. With such loans, you avoid the chance of putting your valuable assets on the line for financing.
- Most small business owners don’t have enough assets to put down as collateral, or they are hesitant to the risk of putting it down. This is why lenders and NBFCs provide unsecured business financing. If you find the perfect unsecured business loans available in the current market, it is easy for you to achieve your financial goals without any inconveniences.
Finance Your Projects with Unsecured Business Loans
- As an unsecured business loan is offered without taking any collateral, the loan is entirely risk-free for the borrower. These loans are solely provided based on the repayment ability and credit history of the borrower. If your credit record is good, the business loan comes at easy terms and conditions.
- Admittedly, this type of loan is a way of finance for developing your business or fixing any immediate financial problems. Make sure to take each factor of the loan into consideration before applying to a particular lender or NBFCs. This type of investment goes a long way in improving the financial aspects of the company if used correctly.
Find Suitable Business Loans
Acquiring small business loans is a daunting task experienced by small businesses, mostly because of tight lending standards by some lenders. However, hurdles outside financing are often needed to develop a business or cover regular expenses. Even though finding, applying for, and getting approved for a small business loan can’t be easy; the more prepared you are, the better is the outcome.
Here are a few points that you should consider when applying for business loans
- Before applying for a loan, you need to question yourself why you need the money and how this loan will assist your business. It is the foremost thing a lender questions from a borrower, so you need to be prepared with the right answer or plan.
- It is not all about finding the best type of loan, but you need to find the best lender as well. Make sure to compare the available options based on the rate and terms of each business loan. You wouldn’t want to connect with someone who can’t understand your needs and provide what you want.
- It is highly essential to find the right loan. You should select a type of business loan based on your much-needed business requirements. If your financial aspects are still not cleared, then there is no point in taking such loans.
Eligibility Criteria for Business Loans
- To apply for a small business loan, you need to be between the ages of 25-55 years.
- Your business should be at least two years old, with a minimum last year turnover of Rs 10 lakhs.
- You should have audited financial statements for the last 12 months.
- You should hold income tax returns filed of your business for at least the previous one years.
Benefits of a Business Loan
- Lenders disburse a business loan instantly so that you don’t need to worry about the business-related functions coming to a stop or development plans delayed due to lack of funds. For example, ZipLoan disburses a loan amount between Rs. 1 lakh to Rs. 5 lakhs with minimal documentation in just three days.
- There are numerous other benefits, as well. However, one of the significant benefits of business loans is that you are not required to indulge in a lot of paperwork. In fact, some even get loans without any security, collateral, and guarantor to meet their needs; from expansion to working capital needs.
- As there is a rising competition among different lenders and NBFCs, the interest rate on a quick business loan is quite affordable. Now, you can take out a business loan without stressing over substantial repayment factors. Of course, interest rates that lenders charge will differ from borrower to borrower, mostly depending on the creditworthiness, tenure, and the motive of needing a business loan.
- You get the option of selecting the tenure of your loan. If you wish to take out a business loan for a short period to suit working capital expenses, you can take a loan for a year. Also, you can expand your business by taking a loan for an extended period of up to two years. It is known as flexible tenures.
Now that you are familiar with the primary benefits of a quick and instant business loan, it’s certainly worth your while to apply for them. After all, you wish to make your business touch new heights, and this business loan will support you to solve any financial problems. ZipLoan provides unsecured business loans that will give you the financial kick to create your business dreams into reality.