In the capital city of Delhi, people from small towns and outskirts arrive every year to find a job or start their own business. In the process, many seek financing to push the growth and expansion of their businesses as well through popular lenders here. Applying for a business loan in Delhi should not be a challenge though to raise the necessary funding if you hold the right eligibility.
Collateral and various document requirements can, nevertheless, exhaust the borrower if you have not done your research well.
Running your own business involves many aspects, such as buying land or renting a shop. Bringing in materials for sale and much more. Arranging and setting up all these would require a lot of money. And not everyone would be backed up with sufficient funding to manage all of it. Banks and other financial institutions help here with their easy application for collateral-free business loans in Delhi. It’s a fairly simple process and especially NBFCs are proving to be of great help in availing one of these funding options.
What are the Benefits of Business Loans?
- Pliant of usage: Unlike equity investors, lenders like banks and NBFCs don’t interfere in the way you run your business. They don’t dictate how you should use the funding raised through a business loan. They only need to ensure you would make timely repayments. Therefore, a business loan can be the best option to have full control over how you spend the funds.
- Trouble-free and simple: Getting a business loan is quite simple these days. Securing the funding can be much more convenient and easier than searching for investors and talking for months.
- Appropriate interest rates: Most lenders offer reasonable interest rates on business loans as opposed. To other types of loans due to high competition among lenders and policy leverages.
- Full control over profits: When you bring an investor on board. They expect a return on the profits your company generates. This is not the case with a loan though. Here, you pay a fixed sum to the lender, i.e., the principal and interest amounts. It remains the same no matter how well your business is doing with the financial support.
- Option of collateral-free loans: Business loans are generally offered with no collateral required. As long as you meet the eligibility criteria.
- Functioning capital support: You can use business loans to increase your working capital, which can be a big help when you’re short on cash. You can run day-to-day operations and cover short-term expenses without digging into the emergency fund.
- Benefits over taxes: Interest on a business loan is often tax deductible. Check the interest rate limit and eligibility before applying for a business loan.
- Flexible loan options: Most lenders have different types of business loan offers to meet the different needs of these ventures. They can offer business loans, working capital loans, machine loans, and many more as per your customised business financing needs.
- Quick outlay: Business loans typically require minimal documentation and are paid off quickly. So, a company doesn’t have to halt operations or plans for growth while it waits for funds.
- Improved creditworthiness: Taking out a business loan can also improve the creditworthiness of the company. However, you must make repayments in time and in full for it to reflect on your credit score positively.
Criteria Set by Lenders to Approval of Business Loan in Delhi:
When applying for a business loan in Delhi, here are a few things to keep in mind.
- Borrower must be an Indian citizen.
- Age must be between 25 and 55 years.
- You should have submitted your income statement and tax returns for your company for the last year.
- You will also need to submit documents such as proof of ID, proof of address, KYC documents, your business certificate. Bank statement for the last 6 months, or any other income document as required.
- Annual turnover must be at least under Rs.3 Lakh.
Important Factors to Consider While Taking a Business Loan in Delhi
There are a few things to take a point of when applying for a business loan. These points can help you in saving on your interest rates as well as can help you in building a good credit history.
- Credit score: You should try your best to hold a good credit score even before applying for the business loan.
- Relationship with the lender: A good relationship with your lender can help you. Get a good deal when it comes to the interest rate on the loan and other borrowing terms.
- Look for festive offers: Lenders often offer good deals to their customers during festive seasons, which is suggested to look out for.
- Loan repayment: You should try your best to deposit the loan instalment before due date.
Shortage of funding is common for businesses of all scales and sizes. Often people use business loans to meet this shortage of funding, which is a great option today. People can avail business loan in Delhi to run the business smoothly, which, in turn, also improves the economy.