Every business needs financing at each step. Starting from setting up a business to buying raw materials and equipment, a business cannot survive without proper funding. Moreover, the financing needs also depends on the necessities and size of the business. This is exactly why entrepreneurs need capital or business loans. Besides, availing of a business loan is becoming easier and simplified with each passing day, as all the leading banks and NBFCs are offering this facility to prospective business owners.
Steps to apply for a business loan in India
With the advancements in digital banking, now individuals can apply for a business loan online. Digital application is way faster than an offline application. If you are thinking to apply for a business loan, you can follow the given steps and save yourself time.
- Search for different banks that offer business loans.
- Compare the banks and their provisions, interest rates and other loan-related charges.
- Narrow down your options based on the ones that match your business requirements.
- Shortlist the one that suits all your necessities.
- Choose their online banking option to fill in the application form.
- Once you have landed on the preferred bank’s website or internet banking app, choose a business loan option from there.
- An application form will appear in front of you, fill that up by providing all the details asked and upload the necessary documents.
- Once you have successfully submitted the application form, the processing of the loan will start.
- You will receive the loan amount within three to ten days in your bank account.
You can even choose to apply for the loan offline by following the steps given below.
- Visit your preferred bank.
- Ask for their business loan related application form.
- Fill that up with all the required details.
- Submit the application and necessary documents to the bank.
- On successful submission, the bank will start processing the loan.
- After successful verification of all your documents and application, the bank will credit the loan amount in your account.
Few things to keep in mind before applying for the loan
There are certain things related to the business loan that must be considered before applying for the loan. These factors are given below.
You must have a thorough idea about the mission and vision of your business. This will not only be beneficial for but also the lender. It will give him the assurance that the borrowed amount will help you to achieve your goals and help in the growth of the company.
You must have a clear cut idea about the amount you need to borrow for your business. A well-devised business plan can help you to calculate an estimate that your business needs.
Chalk out your business plan on a sheet of paper. Show the same to the lender to give them a fair and square idea about your plans related to your business. This acts as a roadmap and becomes a crucial factor while applying for the loan.
Be very sure about the EMIs you need to pay. You can use an EMI calculator for the same and figure out in advance how much you need to pay every month. It must be affordable and fit in your monthly expenses.
The most basic documents that will be needed are your KYC details such as your PAN and Aadhar card and the existing bank records of the firm and the documents related to the business. However, these are just nominal requirements. Every bank has its own set of document requirements.
Besides these, always remember to read the fine print very carefully. Having read this, will save you from surprises and prevent you from any financial obligations in the future