Setting up a new business requires a good deal of investment. From procuring machinery and arranging raw materials to coming up with marketing campaigns, there will be a lot of initial hiccups.
Setting up a new business requires a good deal of investment. From procuring machinery and arranging raw materials to coming up with marketing campaigns, there will be a lot of initial hiccups. The financial hiccups should not be the reason why you give up on your dreams. There are several commercial lending organizations and banks that offer business loans. It is wise to take their help when setting up your business. Business loans will also be useful when you are looking to expand your business.
When a bank gives you a commercial loan, they are only on the lookout for debt repayment. They are not entitled to the profits that you will be making on the venture. Moreover, the interest that you pay on your business loan is subject to tax deductions. Thus, having agreed upon the fact that it is wise to apply for a business loan, one must realize that doing so online attracts tons of other benefits. Read on to know how you can apply for a business loan online.
1. Choose your lender
The first step in the online application of a business loan is deciding your lender. Most banks offer business loans without any security. Choose a bank whose interest rates are the lowest, and the repayment terms are feasible for you. Also, you must go through the bank’s website carefully to find out about any hidden charges.
Once you have agreed upon your lending organization, the next major thing would be to find out if the bank will give you the loan. The eligibility criteria varies from bank to bank, and you may need to visit the bank’s website to get the exact details. While most of the banks prefer giving out business loans to people in the age group of 21 to 65. Banks prefer giving loans to businesses that have at least Rs 1.5 lakhs as their Minimal Annual Income (ITR) or an annual turnover of 40 lakhs and above. In case this criterion is not met, but your business is making a profit for the last two years, you are eligible to apply for a personal loan online.
3. Minimal documentation
When you apply for a business loan online, very little documentation will be required. You just need to submit a copy of your PAN card, identity proof, address proof, and the bank account statements for the last 6 months. Some banks also ask for a copy of the company bank sheet, trade license, or sales tax certificate. You may upload the scanned copies of all of these and attach them to your business loan application online form.
4. Quick disbursals
Most banks are very quick in disbursing business loans. If you have your documents in order, the bank will be able to approve it the same business day. In the next 24 hours, the money will be transferred to your account.
The process of applying for a business loan online is a very transparent one, and most banks have clear documentation on what they expect of a customer. With several money lenders in the market, there arises competitive pricing. If you compare a business loan to other funding options such as that of finance companies or credit cards, you will realize that the interest rate of business loans is much lesser.