Business Loan in Coimbatore

Why are business loans beneficial?

Business loans benefit a business in a number of ways:

1. Business expansion

Whenever a business reaches a certain stage where it has to grow or expand, it would need capital to do so. Business loans can help a company to grow their business operations as they want to.

2. Increase working capital

Many businesses may also fall short of funds to carry out their day-to-day operations. A business loan is a viable option to source funds for the smooth functioning of your business. 

3. Purchasing equipment

Another reason for taking a business loan may be to upgrade the current plant and machinery. The equipment depreciates every year and so it may be a good idea to buy, rent or lease new machinery to improve production efficiency. – Know more  – Machinery Loan

4. Purchasing inventory

Many sectors require immediate capital to procure raw materials or inventory stocks. Sudden fluctuations in the market may see prices of some of these raw materials escalate, in which case a business loan can help a business to buy the raw materials they need for production. 

5. Improving credit history

A business loan also improves the credit history of the business with consistent and on-time payments.

Eligibility for business loans

Although different banks have different criteria, business loans are offered to enterprises with a good turnover and CIBIL score. 

Every bank and NBFC evaluate the business performance and then decides the tenure, loan amount and interest rate. The lender also reserves the authority to refuse a business loan if your business does not fulfill any of their criteria. 

These are some of the general criteria that lenders take into account:

1. The applicant should be an Indian resident
2. Applicant should be self-employed with a minimum of 3 years of business experience
3. Applicant should be a minimum of 21 years of age
4. Has to provide information on business turnover and IT returns for the last 2 financial years
5. The Business should be operating in profit for the last 2 years.

Documents required to apply for a business loan

Following are the documents required to apply for a business loan:

1. Identity Proof

Aadhar Card, Voter ID, Driving Licence.

2. Address proof

Voter ID, utility bills.

3. Bank statement

For the previous 6 months

4. Financial Documents

Business Income Tax Certificate, Balance Sheet, P/L statement.

5. Proof of business

Trade license, registration certificate, establishment license.

Business loans in Coimbatore

You can opt for business loans in Coimbatore from banks or NBFCs, as per your preference. 

With banks, you can avail of a secured or unsecured business loan if your CIBIL score is 650 or more. NBFCs generally grant collateral-free loans but charge a higher rate of interest in return. 

There are many more banks and NBFCs offering business loans in Coimbatore. You can check them online and compare them to find the best plan for your business.

Steps to apply for a business loan 

You can apply for business loans in India via online and offline mode. 

Online:

1. Visit the official website of the lender
2. Select business loans in the menu section
3. Download the application form and fill in the details
4. Submit the application form 
5. The application will then be verified by the lender
6. If the loan is approved, the amount will be credited to the applicant’s account in 5 working days.

Offline:

1. Visit the nearest branch if the lender
2. Ask for a business loan application
3. Fill in the details with the attested form and submit all required documents
4. Lender will verify the information furnished
5. Lender would disburse the amount if the applicant is found to be eligible.