TechBookyBusiness
No Result
View All Result
Tuesday, July 5, 2022
  • Login
  • Home
  • TechBooky
  • Africa
  • TV
  • Startup
  • Earnings
  • Crypto Price
  • Submit Article
  • Contact Us
  • About Us
Subscribe
TechBooky Business
No Result
View All Result
Home Enterprise

Important Checklist – 8 Things To Do Before You Apply For A Business Loan

Contributor by Contributor
August 26, 2021
in Enterprise, Money
Share on FacebookShare on Twitter

Small to medium-sized businesses often look out for financing options that can help them fulfil their immediate to long-term funding needs without much hassle. The availability of a business loan with various borrower-friendly features makes it easier for businesses to attain financial stability, allowing them to take the necessary decisions towards growth and expansion. Individuals owning a business can easily apply for business loan with one of the lending institutions offering favourable terms of service.

These loans are usually available as unsecured advances and come in high financing value, making them all the more reasonable to avail for an enterprise not willing to risk its asset. The necessary financing value can be availed only against minimum eligibility criteria that the lending institution requires one to fulfil. However, availing the funds can be a challenge if you are not well-prepared. We have brought you the following checklist to help you prepare before you apply for a business loan to improve your chances of loan approval and to easily manage the advance. Take a look.

Clarity Regarding the Need for Financing

A business may need financing for several reasons, from fulfilling immediate funding needs to fulfilling long-term capital investment. Simultaneously, while it makes long-term goals attainable, gaining clarity regarding the expenditure you need to meet with the advance allows you to project a well-planned business prospect, making your candidature a reasonable lending option for financial institutions.

Thus, before you apply for a business loan, make sure that you have gained sufficient clarity regarding the expenditures that would be met with the help of such financing. It allows you to go through a smooth application process, also helping gain lender confidence regarding your financial planning and discipline.

Available Borrowing Options

Before borrowing, it is essential that you explore all the available financing options in the market. Doing so shall allow you to find the lender offering reasonable financing value at favourable terms as well as affordable rates. Go for an extensive, in-depth market research that should help you gain a better perspective on the available features from different financial institutions.

Some of the best lenders offer high financing value of up to Rs.25 Lakh as unsecured business loans to enterprises against competitive rates of interest. These loans come with flexible repayment options and require you to meet only minimum eligibility and document criteria to apply.

With a high eligibility than the minimum requirement and an exceedingly reasonable repayment capacity, you also stand to negotiate with your financial institutions to secure the most favourable terms before your apply for a business loan.

Flexibility of Repayment Tenure

Reputed financial institutions also bring extended tenures to allow easy repayment of the advance, and enable borrowers to choose suitable repayment plan as per their financial capacity. Such flexibility in repayment tenure allows you to align our repayment plans with the monthly business revenue that you garner. It thus also makes it convenient to manage your loan efficiently, helping you maintain a high creditworthiness as well with full and timely repayment of the advance.

With some of the most prominent NBFCs in the market, you can expect to opt from a tenure flexibility of up to 5 years for unsecured business loans. When availing secured financing, such flexibility can go up to as long as 15 to 20 years, allowing you ample scope to manage your finances without much hassle.

Business Growth and Expansion Plans

Keeping the growth and expansion plans of your business upright has similar benefits as keeping your expenditure objectives clear for loan utilisation. Long-term growth and expansion plans of a business allows it to project long in the future the expansion it is willing to reach with the available and prospective resources it aims to gather in the future.

An ideal business plan comprises both past achievements and future objectives, which also allows it to reflect on the metrics of achievement later on. Submitting such a plan to your lending institution along with the loan application allows them to review business stability and reliability. A futuristic approach to the financing thus nudges your lender to conveniently sanction the financing needed for your business.

Document Requirements

Along with business growth prospects, you must also back your application with the necessary documents to ensure individual identity, business existence and perpetuity until your application. Lenders often require you to provide the following essential documents to establish your identity and eligibility for the advance.

  • KYC documents: These are documents that establish the identity and address of the borrowing applicant. They include any document carrying photo and/or address of the individual applying for the loan which is approved by the RBI and issued by an authorised body. Some of the common KYC documents you can submit include PAN card, Aadhaar card, Voter ID card, Passport, Driving License, Ration cars, utility bills and the likes.
  • Proof of business existence: Documents like incorporation certificate, partnership agreement, GST certificate, etc. serve as a proof of the business’s existence.
  • Income documents: You would also need to provide necessary income documents that should help establish your repayment capacity, which primarily include your bank account statements and Income Tax Return filed for 2 to 3 previous years as required.
  • Financial statements: Financial institutions also require businesses to submit their financial statements like balance sheet, profit and loss statements, etc. for them to easily assess the business’s financial stability.

Loan Affordability

Before you apply for a business loan, it is essential to check whether the financing amount is turning out affordable or not over the tenure selected. You can assess the total repayment liability along with the EMIs payable and the total interest payable to estimate your affordability for the advance. The right financing value should keep your monthly liabilities payable as EMIs affordable while also ensuring a reasonable interest accumulation over the years.

Lenders provide free financial tools like business loan EMI calculators and eligibility calculators to help you assess your loan amount and tenure feasibility so that you apply for the right financing value. The tools are easy to use and require you to input only a handful of loan and personal details to obtain the results.

Interest Rate and Charges Applicable

When it comes to loan affordability, interest rate is among the first parameters to check. You should thus make sure to compare different lenders available in the market to ensure that the loan option you have selected offers a competitive rate. Alongside, it is equally essential that you know about other applicable charges, which can also contribute significantly to your total loan affordability and make repayment convenient.

Eligibility for a Business Loan

When applying for the advance, you would also need to fulfil a handful of eligibility requirements that establish your qualification for the financing value. Lenders lay down these criteria to ensure that your business can afford the financing and repay it in time, also eliminating a degree of risk from the borrowing profile.

As these business loans are mostly unsecured advances, a minimum individual and business credit score is required, which should be not less than 750. The applicant must also have a minimum annual as well as monthly income to ensure affordability. Other criteria for loan eligibility include age of the borrower, business stability, business existence for a set number of years, and the likes.

Once you have met the eligibility requirements laid down by your financial institution, you can proceed to apply for a business loan. While both offline and online application processes are available, it is ideal to go for the latter as it streamlines the application process, eliminating lengthy paperwork and other requirements on the way, allowing quick approval and disbursal of the advance.

Total
0
Shares
Share 8
Tweet 0
Pin it 0
Share 0

Related Posts:

  • Nigerian Lending Startup PayHippo Raises $3 Million To Improve Access To Swift Credit For SMEs
    Nigerian Lending Startup PayHippo Raises $3 Million To…
  • Microloan Platforms In Nigeria: How They’re Fast Becoming Curate’s Egg
    Microloan Platforms In Nigeria: How They’re Fast Becoming…
  • Payhippo – A Digital Lending Platform Raises $1m In Pre-seed Round To Fund More African SMEs
    Payhippo – A Digital Lending Platform Raises $1m In Pre-seed…
  • Nigeria’s Fintech Indicina Secures $3 Million In A Funding Round Led By Tiger Global
    Nigeria’s Fintech Indicina Secures $3 Million In A Funding…
  • Google Announces $15 Million Financial Assistance Program In India, To Give Out Loans to Businesses In Partnership With The SIDBI
    Google Announces $15 Million Financial Assistance Program In…
  • Kenya's Fast-rising Fintech Platform Zanifu Raises $1 Million In Seed Funding, Plans To Upgrade Its Platform and Grow its Client Base
    Kenya's Fast-rising Fintech Platform Zanifu Raises $1…
  • 4G Capital, A Kenyan Fintech, Secures $18.5 Million In Series C Funding From Lightrock
    4G Capital, A Kenyan Fintech, Secures $18.5 Million In…
  • Nigerian Fintech Company, Lidya Raises $8.3m In Funding A Year After Its Europe Expansion
    Nigerian Fintech Company, Lidya Raises $8.3m In Funding A…
Tags: businessbusiness loanloantips
Previous Post

Google Calls It Quits With Qualcomm, Samsung Will Supply Google With The 5G Modem For Imminent Flagship Phone

Next Post

NIBSS’ QR Payment Solution Is Now Available For Lagos Buyers And Sellers

Next Post
NIBSS’ QR Payment Solution Is Now Available For Lagos Buyers And Sellers

NIBSS’ QR Payment Solution Is Now Available For Lagos Buyers And Sellers

No Result
View All Result

Get top tech business news in your inbox

subscription from
Loading

Crypto Price List

  • USD
  • EUR
  • GPB
  • AUD
  • JPY
  • TadpoleTadpole(TAD)
    $7.32-1.74%
  • SEENSEEN(SEEN)
    $2.05-2.27%
  • EvedoEvedo(EVED)
    $0.082301-0.80%
  • MarginswapMarginswap(MFI)
    $0.184213-2.11%
  • SakeTokenSakeToken(SAKE)
    $0.0127135.28%
  • WTF TokenWTF Token(WTF)
    $0.0113500.17%
  • BNSD FinanceBNSD Finance(BNSD)
    $0.005461-5.83%
  • RobotinaRobotina(ROX)
    $0.00266138.50%
  • CageCage(C4G3)
    $0.005010-3.67%
  • YAM v2YAM v2(YAMV2)
    $4.70-1.41%

Recent Posts

  • Financial Inclusion In Nigeria Grew To 45 Percent In 2021 – World Bank
  • Meta Is Shutting Its Novi Digital Wallet By September 1st
  • Crypto Is The Answer To Financial Inclusion, Central African Republic’s President Says Amid Huge Aversion For Its Adoption Of Bitcoin
  • Popular Bitcoin Family Reveals They’ve Had Bitcoin Losses Of Up To $1 Million This Year
  • June Was Bitcoin’s Worst Month On Record After The Flagship Crypto Lost 40 Percent Of Its Value

Categories

  • Acquisition
  • Acquisition & Merger
  • App
  • Banking
  • Capital
  • Cryptocurrency
  • Earnings
  • Ecommerce
  • Economy
  • Enterprise
  • Event
  • Funding
  • Gadget
  • Government
  • internet
  • Investment
  • Market
  • Merger
  • Money
  • Partnership
  • Personnel
  • Service
  • Social Media
  • Startup
  • Stocks
  • telecom
  • Venture Capital

Get top tech business news in your inbox

subscription from
Loading

Popular Tags

Acquisition africa amazon apple bitcoin cbn china coinbase company crypto cryptocurrency e-commerce earnings earnings season elon musk facebook fintech Funding gadget google government india internet Investment ipo kenya microsoft money netflix nigeria payment payments Q1 revenue russia service shares social media Startup Stock tech tesla twitter Ukraine whatsapp

Calendar

July 2022
M T W T F S S
 123
45678910
11121314151617
18192021222324
25262728293031
« Jun    

Categories

  • Acquisition
  • Acquisition & Merger
  • App
  • Banking
  • Capital
  • Cryptocurrency
  • Earnings
  • Ecommerce
  • Economy
  • Enterprise
  • Event
  • Funding
  • Gadget
  • Government
  • internet
  • Investment
  • Market
  • Merger
  • Money
  • Partnership
  • Personnel
  • Service
  • Social Media
  • Startup
  • Stocks
  • telecom
  • Venture Capital

Recent News

  • Financial Inclusion In Nigeria Grew To 45 Percent In 2021 – World Bank
  • Meta Is Shutting Its Novi Digital Wallet By September 1st
  • Crypto Is The Answer To Financial Inclusion, Central African Republic’s President Says Amid Huge Aversion For Its Adoption Of Bitcoin
  • Popular Bitcoin Family Reveals They’ve Had Bitcoin Losses Of Up To $1 Million This Year
  • June Was Bitcoin’s Worst Month On Record After The Flagship Crypto Lost 40 Percent Of Its Value
  • Nigerian Mobility Startup Moove Gets $20 Million From The UK Government’s Development Finance Institution – British International Investment (BII)

© 2021 Techbooky Business - Design by Techbookyelite.

No Result
View All Result
  • Home
  • TechBooky
  • Africa
  • TV
  • Startup
  • Earnings
  • Crypto Price
  • Submit Article
  • Contact Us
  • About Us

© 2021 Techbooky Business - Design by Techbookyelite.

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In
  • bitcoinBitcoin(BTC)$19,440.96-1.42%
  • ethereumEthereum(ETH)$1,099.25-0.88%
  • tetherTether(USDT)$1.00-0.09%
  • usd-coinUSD Coin(USDC)$1.000.01%
  • binancecoinBNB(BNB)$224.640.31%
  • Binance USDBinance USD(BUSD)$1.000.12%
  • rippleXRP(XRP)$0.316209-2.29%
  • cardanoCardano(ADA)$0.449576-3.70%
  • SolanaSolana(SOL)$33.48-2.53%
  • dogecoinDogecoin(DOGE)$0.065824-2.99%
  • polkadotPolkadot(DOT)$6.68-4.32%
  • Shiba InuShiba Inu(SHIB)$0.000010-1.76%
  • AvalancheAvalanche(AVAX)$16.82-3.63%
  • matic-networkPolygon(MATIC)$0.4980465.18%
  • Terra Luna ClassicTerra Luna Classic(LUNC)$0.000071-5.36%
Posting....