The eligibility criteria for business loans vary from one lender to another. Most lenders have specific age limits for applicants and may require businesses to maintain a minimum annual turnover for one or more years. Other factors, such as credit score, business stability, and repayment capacity, may also be considered.
You can easily check your eligibility using a Business Loan Eligibility Calculator before applying.
Calculating your EMI before taking a business loan helps you understand the monthly repayment amount, including both principal and interest components. This allows you to plan your finances better, ensure timely repayments, and choose a loan amount and tenure that fit your business’s cash flow.
Under the Reverse Charge Mechanism (RCM), the recipient of goods or services — not the supplier — is responsible for paying the GST. To calculate it, simply enter the cost of goods or services and select the applicable GST rate in the calculator. The tool will automatically display the tax amount payable under reverse charge.
If you miss an EMI payment, your lender may charge a late payment charges (penalty fee or late payment interest) as mentioned in your loan agreement and Key Fact Statement (KFS).
Missing an EMI can also affect your credit bureau score, which may impact your ability to get loans in the future. In some cases, your repayment schedule or loan tenure may be adjusted to account for the delay.
To calculate GST using an online calculator, simply enter the net price of the goods or services and select the applicable GST rate/ percent. The calculator will automatically display the GST amount, total amount payable (base + tax), making the process quick and error-free.
The interest rate for a business loan varies depending on factors such as the lender’s policies, the borrower’s credit profile, the type of loan, and market conditions. Since most business loans are unsecured, their interest rates are generally higher than those of secured loans. Borrowers are advised to review and negotiate the rate with the lender before finalizing the loan agreement.
The applicable interest rate and the method of interest calculation (such as fixed or reducing balance rate) are clearly communicated to the borrower at the time of loan sanction. These details are reflected in the sanction letter and the Key Fact Statement (KFS), which specify the annualized interest rate, processing fees, and other charges in a transparent manner.
