Check out the Easy Business Loan Eligibility Criteria and Documentation.

 Empowering Your Business Growth

A Business Loan provides the capital you need to start, expand, or improve your business operations. Whether you're looking to purchase equipment, increase working capital, or expand your operations, a business loan offers a flexible and affordable solution.

Eligibility Criteria for Business Loan

Eligibility criteria for business loans depend on your business type, financial health, and credit score.

Basic Eligibility Criteria:

  • Age: The business owner should be between 25 and 65 years.
  • Business Vintage: Typically 2 to 3 years of business operations
  • Annual Turnover: Minimum turnover as per the lender's requirements
  • Credit Score: A good credit score (700 or above) is typically required for better loan terms.
  • Profitability: Consistent profits over the last 2 to 3 years are considered favorable.

Documents Required for Business Loan

For Sole Proprietorship and Partnerships:

  1. Identity Proof: PAN, Aadhaar, Passport
  2. Address Proof: Utility bill, Passport, Driving License
  3. Business Proof: GST registration, trade license, and partnership deed (if applicable)
  4. Financial Statements: Last 2-3 years’ Income Tax Returns (ITR), balance sheet, and profit & loss account
  5. Bank Statements: Last 6 months' personal and business bank statements
  6. Collaterals: Property documents, machinery papers (if applicable)

For Private Limited Companies or LLPs:

  1. Company Registration: Certificate of incorporation, MoA, and AoA
  2. Director’s Proof: Identity and address proof of directors
  3. Financials: Last 3 years’ audited financial statements
  4. ITR: Income tax returns for the last 2-3 years
  5. Business Proof: Business registration certificate and trade licenses
  6. Bank Statements: Company’s bank account statements for the last 12 months.

Features of a Business Loan

  1. Loan Amount: Loan amounts typically range from ₹50,000 to ₹50 lakh or more, depending on the business requirements and eligibility.
  2. Interest Rate: Competitive interest rates that depend on your business profile, credit score, and loan amount.
  3. Repayment Tenure: Flexible repayment terms, typically ranging from 1 year to 5 years, allowing businesses to manage cash flow.
  4. Collateral Requirements: Some loans are unsecured, while others require collateral based on the loan amount.
  5. Processing Fees: One-time processing fees may be charged, usually ranging from 1% to 3% of the loan amount.
  6. Quick Disbursal: Fast approval and disbursal to meet urgent business needs.
  7. Tax Benefits: Interest payments on a business loan are generally tax-deductible under Section 36(1)(iii) of the Income Tax Act.

Benefits of a Business Loan

  1. Quick Access to Capital: Get the funds you need without selling equity or taking on investors.
  2. Flexible Usage: Use the funds for working capital, expansion, inventory, equipment purchase, or any other business purpose.
  3. No Equity Dilution: Unlike venture capital or investor funding, you retain full control of your business.
  4. Improved Cash Flow: Access to extra capital helps in managing business expenses, paying off liabilities, and maintaining liquidity.
  5. Tax Savings: You may receive tax benefits on the interest paid for loans used for business purposes.
  6. Credit Profile Improvement: Timely repayment of the business loan can help build or improve your credit score for future financing.