How to Improve the Chances of Getting a Business Loan Approval?

It takes money to make money. Even if you have a great business idea, it will take some initial investment to market it and bring it to fruition. Unsecured small business loans are a popular choice for quick business finance due to their small ticket sizes and faster approval process. However, not every business loan application gets approved, even if you are applying with a financier who has easier lending rules.

In today’s post, we are sharing the bare essentials, which you should get right, to improve your chances of getting a business loan approval

Improve a lacklustre credit score

If your personal and business credit scores are not in order, there is a high chance that your loan application will get rejected. Worst still, you might be offered a loan with exorbitant interest rates, which will only make it harder for you to repay the loan and further diminish your credit worthiness. So, before applying for a business loan, get your credit report and take steps to improve it. In case you have raises a dispute with the credit bureau, wait for its resolution before applying for a loan, otherwise a lender might deny your loan application based on faulty information.

Make your calculations in advance

If you are starting a new business, assess your financial needs and keep an eye out for lucrative business loan deals even if you do not need the funds immediately. Being aware of your business’s exact capital requirements and institutions that cater to your specific financial needs can speed up the loan approval process significantly.

Have a business plan

When planning for a business loan, have a business plan ready to share with the lenders to convince them of your commitment to repayment. The plan should have an executive summary that explains what your business does, and how you plan to make money. Also include a market assessment and data of present business expenditure.

Get the documentation right

A lender will ask for most recent years’ profit and loss statements, balance sheets and cash flow statements, so make sure you have them in order. Apart from this, business incorporation certificates, tax filings and address and identity proofs are a pre-requisite for business loan approvals. Check with the lender beforehand and get the documentation right to speed up your business loan approval.

Apply with FinTech lenders like Lendingkart

If you need a fast business loans, apply with a FinTech lender instead of traditional banks and NBFCs. Where bank and NBFCs take up to 10 days to process a loan application, a FinTech firm like Lendingkart will authorise loan disbursal within 3 days of application and approval. Moreover, FinTech lending comes with several other benefits like minimal processing charges, low interest rates, flexible EMI options, zero prepayment fees and quick renewals.

To know more about FinTech lending and apply for a fast business loan, click here.

Digital Banking in India for Quick Business Loan Approvals

Digital banking is fast becoming the new normal in India. While there is still a lengthy road ahead for total digital integration of the financial sector, at least the ground work is moving apace with latest technologies such as credit cards, net banking, e-wallets and now UPI as well.

Digital banking is also helping businesses manage their finances in a more transparent and accountable manner. Business managers can now assign daily, weekly and monthly working capital to their executives and keep track of the expenditure in real-time through mobile app based ecosystems. Online banking is facilitating on-the-go money transfer for businesses, giving a veritable boost to their operational agility and saving many man-hours worth of productivity.

Going digital also means that all your financials can be verified through online processes, making it easier to get business loan approvals. For example; e-statements of accounts are now accepted by most financial institutions. Non-banking finance companies such as Lendingkart Finance offer online business loans by evaluating your digital bank statements, keeping the whole process of application to approval of a business loan online.

You can also renew your loan upon repayment by simply clicking on the renewal link in your Lendingkart account. You will receive the pre-approved amount without any paperwork or processing fees when you avail this facility. Here are the steps which will help your business in going digital and enable faster loan approvals for you.

  • Link your Aadhar Card Number to all bank accounts, PAN, and company records.
  • Get digital copies of your business incorporation certificate, TAX compliance reports, GST filing and KYC documents. Save these files in a secure cloud service such as DigiLocker.
  • Keep a track of your CIBIL score, and take steps to improve it further. A CIBIL score above 750 evokes a lender’s confidence in your business.
  • Use online business loan platforms such as Lendingkart Finance to obtain faster working capital loans in India.

Lendingkart also has its own Android business loan app. You can simply download it on your smartphone and apply for a loan within minutes. The app also lets you keep track of your loan’s repayment and EMI due dates.

So, digitise your business today and avail all the benefits that come with it. To know more about Lendingkart interest rates and business loans, click here.