Short-term business loans are a popular choice among business owners as it can provide capital and financial stability to the business. However, there are long-term business loans available in the market as well that they can also avail. Nevertheless, it is important to understand the type of loan credit facility which is being availed in order to make a good choice for the betterment of the business.
Long-term Business Loans VS Short-term Business Loans
Long-term business loans are availed for a long time period. The loan tenure can go up to 10 years. Also, the loan amount is high for long-term loans which can go up to 1 crore. And short-term business loans are availed for a short time period where the loan tenure can range somewhere between 1 year to 2 years. The short-term business loans in India are mostly availed for small businesses.
Now let’s take a look at why a short-term loan is beneficial for small business owners in India.
Short-term Business loans for Small Businesses
Long-term loans are usually offered to established big business houses. Since the tenure for the loan is very long, the lenders ensure that the businesses have the capability to run long. So, they offer their services to well-established businesses only. The short-term business loans online are offered to small businesses with the business vintage of just 2 years. So, they are accessible by small business owners as well.
Short Loan Application Process
The loan application process for a business loan for short-term is very easy. The short-term loan lenders offer an easy and short loan application process where the borrower can fill the application online. Also, the borrowers can also upload the documents online without visiting the lender’s office. So, this makes the entire loan application process hassle-free.
Documentation for Short-term Business Loans
The documents required for unsecured business loans for a short time period are minimal. The loan lenders require just the PAN, address proof, bank statement, and ITR. So, the borrower is not required to collect piles of documents but just 4-5 documents. However, for long-term loans, the borrower is required to submit a long list of documents for a long-term loan in order to establish business credibility.
Long-term business loans are a long term liability for the business owner. And therefore, before availing the services, it is important to assess the business situation in financial terms. Nevertheless, the short-term business loans are not a long-term liability and they can be availed for just 12 months only.
Online business loans provide the funds which can be used to take advantage of the market opportunities. So, you too can avail the best short-term business loan for the benefit of your small business. Additionally, you can also register your business for free at the Connect App by ZipLoan to build your business network. Through the e-marketplace, you can create a business profile, list your products/services, find business, discover new business opportunities, and build connections.