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Working Capital Term Loan (WCTL)

Fuel the growth of your business and streamline cash flows with working capital term loans!

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Minimum Interest Rate

14% p.a.
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Maximum Loan Tenure

96 months
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Maximum Loan Amount

₹50 Lakhs

Working capital allows you to invest in strategic inventory purchases and expand your marketing reach. You can seize unexpected business opportunities with access to capital. A working capital term loan bridges these short-term gaps. Use the funds to clear dues and capitalise on growth opportunities ahead of competitors.

What is a Working Capital Term Loan

A Working Capital Term Loan (WCTL) provides businesses with a fixed sum of funds to manage short-term working capital requirements. Unlike traditional term loans used for long-term investments, WCTLs are intended to support immediate operational costs and liquidity needs. 

You can check your business loan eligibility to determine the amount of funding available for your short-term obligations.

Features of Working Capital Term Loans

A working capital term loan provides flexible financing to help businesses manage their day-to-day operations. These loans are designed with borrower-friendly features to ensure convenience and efficiency. Key benefits include

  • High Loan Amount

Access funding of up to ₹80 Lakhs to meet a wide range of business expenses. Whether for inventory, salaries, or marketing, this amount helps support both small and large operational needs.

  • Quick Disbursal

Funds are typically credited to your bank account within 48 hours of loan approval. This ensures minimal disruption to your daily operations and timely access to working capital.

  • No Collateral Required

You can obtain the loan without pledging any assets or providing security. This makes it easier for small businesses and startups to secure funding.

  • Flexible Tenures

Repay the loan over a convenient tenure of up to 96 months. Longer repayment periods allow for better cash flow management and reduced monthly outflows.

  • No Hidden Charges

Enjoy full transparency with all applicable fees shared upfront. This helps you plan your finances better and avoid unexpected costs.

  • Competitive Interest Rates

Benefit from interest rates starting at just 14% per annum. This makes your loan more affordable and reduces the overall cost of borrowing.

  • Simple Online Application

Apply anytime, from anywhere, using a streamlined digital process. Minimal paperwork and quick verification make the experience hassle-free.

Uses of a Working Capital Term Loan

This credit facility is a strategic tool that helps you unlock the true potential of your business. The following are some of the common reasons why companies take working capital term loans.

  • Purchase Raw Material 

A working capital term loan can empower you to purchase raw materials in advance. This ensures you can capitalise on opportunities without letting stock shortages hinder your growth.

  • Manage Seasonal Fluctuations

For businesses with seasonal sales cycles, maintaining regular cash flow is a challenge. This loan offers a financial safety net during seasonal dips, helping manage fluctuations in operational costs.

  • Expand Inventory

A limited inventory can restrict your ability to meet customer needs. This loan can be the key to expanding your inventory. It enables you to offer a wider selection of products, cater to larger orders, and tap into new markets.

  • Handle Unexpected Expenses

A working capital term loan acts as a financial buffer during unforeseen events. It allows you to handle such expenses efficiently, whether it is equipment repairs, sudden surges in material costs, or other disruptions.

How Does a Working Capital Term Loan Work

A working capital term loan helps you manage short-term business needs by providing timely funds. The process typically works as follows:

  • Application Submission: You start by submitting an application along with documents like financial statements, business plans, and tax returns
  • Lender Evaluation: The lender reviews your creditworthiness, cash flow, and repayment capacity
  • Loan Sanctioning: Based on the assessment, the lender decides the loan amount, interest rate, and repayment schedul
  • Fund Utilisation: You can use the funds for immediate business needs such as inventory, marketing, or operational costs

  • Repayment: You repay the loan in regular instalments as agreed, which helps maintain your credit health and improves future funding prospects

Example of Using a Working Capital Term Loan

This credit facility often helps businesses cover the time difference between accounts payable and accounts receivable. The need for these loans is felt more in seasonal businesses. This is because such businesses experience peak seasons with high cash inflows, followed by periods of reduced or irregular income. 

They generally rely upon WCTLs to remain operational throughout the year. Check out a real-world example of a business needing working capital term loans:

  • Consider a business specialising in handcrafted Diwali lights 

  • It manufactures clay diyas, intricate paper lanterns, and vibrant LED string lights

  • A significant portion of their income arrives after Diwali 

  • But they have to incur significant expenses well in advance 

  • They require capital for purchasing raw materials, hiring temporary staff to meet production demands, and stocking up on inventory 

  • This creates a cash flow gap that can hinder their ability to capitalise on the peak Diwali season

  • They need a working capital term loan to keep their business operational before the Diwali season 

  • With the loan, the business can maximise production capacity, maintain inventory levels or seize growth opportunities 

Getting a WCTL can help manage your business operations seamlessly, as you can use the funds to cover day-to-day operational expenses. Compare the interest rates offered by various lenders and choose one that best fits your requirements.

Disclaimer

Reference of all T&C necessarily refers to the terms of the Partners as regards to pre-approved offers and loan processing time amongst other conditions.

Frequently Asked Questions

What is the full form of WCTL?

In banking, the full form of WCTL stands for working capital term loan. It refers to a loan structured to meet the short-term operational requirements of a business.

The maximum tenure of a working capital term loan is up to 96 months on Bajaj Markets. However, the actual tenure may vary based on the lender’s policies and the applicant’s credit profile.

The formula for a working capital term loan is:

WCTL = Total Current Assets – Total Current Liabilities – Bank Overdraft – Cash Credit.

This calculation helps identify the net working capital needed after accounting for existing liabilities and available credit limits.

To be eligible for a working capital term loan on Bajaj Markets, meet the following criteria:

  • Be an Indian citizen aged 21 years or above

  • Have a CIBIL score of 700 or higher

  • Have 1 to 3 years of business experience

  • Your business must be a registered entity with a minimum annual turnover of ₹1 Lakh

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