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Mistakes business owners do while applying for business loans

By Finserv MARKETS - Jul 27,2019
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Business Loan Mistakes

This is it, the moment you have been waiting for is finally here: your dream of starting your business or startup have come true, all that is left to do is you need to get financing for the same. If you are looking to avail a business loan it is important to remember that the application and approval process is very different from getting a personal or a home loan. Not only are business loans harder to obtain, but simply maneuvering the application process for one can be incredibly stressful and time-consuming. However, you do not need to worry about the same. We have compiled a list of mistakes that business owners often make while availing business loans to help make this process less stressful and also improving your chances of getting a loan.

1. Not having a business plan

Most banks will require you to present a business plan, which highlights information about your business, ranging from information about the line of business you will be operating in, to the production process, marketing plans and strategies as well as where the funds acquired will be used, amongst several other factors. Banks and lending institutions often use business plans as an indication of the applicant’s seriousness about their work. In fact, your business plan is also very useful for you and your company as it helps in planning when and how you will be able to repay your plan. As it is rightly said, failure to plan is planning to fail, so ensure that you devote adequate time to come up with a well-researched business plan, which will not only improve the chances of your loan being approved but also serve as a long term planning tool.

2. Not shopping around to find the best lender

Just like when you go to the mall to buy a new pair of jeans, you don’t simply buy the first pair you see in the first store. Similarly, for business loans, it is critical to shop around and find the best lender that suits you and your business. The market has been flooded with business loan providers. However, it is up to you to research lenders and find out which suits you the best. While loyalty is a good attribute, simply choosing a business loan because you have had an account with a bank for years is not financially prudent. Similarly, while it may seem more convenient do not simply obtain a business loan from your local bank because it is closely located. You can shop for a business loan on Finserv MARKETS whereby, you can get competitive interest rates, which can reduce the additional financial burden that comes with taking on a business loan. Business loans offered through digital platforms such as Finserv MARKETS can help you access leading products such as the Bajaj Finserv business loan for affordable access to money.

3. Put in no equity in your own business

A grave mistake that applicants often make is that they do not have any equity in their own business venture. It is important to remember that business loans are very different from home or personal loans, making it very necessary for you to invest in your own project. This is because the lending institution or bank will be more enthusiastic about taking such a risk. If you have any more questions about the same, you can speak to a trusted financial advisor on a portal such as Finserv MARKETS that provides 24×7 support and assistance on the loan process.

Getting the right business loan can make all your dreams about running and having your own business become a reality. It is critical that you spend some time ironing out the details of your business plan and finding out a loan that will help serve you and your new businesses financial interest better.

Thanks to Finserv MARKETS, you can apply for a Bajaj Finserv Business Loan online, get approval in 3 minutes and money in your account in 24 hours and host of other benefits of business loan. In fact, you don’t even need a guarantor to get your business loan approved and there are no hidden charges.

Also, read about SME Loan meaning and its benefits.

Finserv MARKETS, from the house of Bajaj Finserv, is an exclusive online supermarket for all your personal and financial needs. We understand that every individual is different and thus, when you plan to achieve your life goals or shop for the gadget of your dreams, we believe in helping you Make it Happen in a few simple clicks. Simple and fast loan application processes, seamless, hassle-free claim-settlements, no cost EMIs, 4 hours product delivery and numerous other benefits. Loans, Insurance, Investment and an exclusive EMI store, all under one roof – anytime, anywhere!

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Bajaj Finserv Direct Limited ("BFDL"), erstwhile Bajaj Financial Holdings Limited is a registered corporate agent of Bajaj Allianz Life Insurance Company Limited and Bajaj Allianz General Insurance Company Limited under the IRDAI composite registration number CA0551 valid till 10-Apr-2021. BFDL also renders services to Bajaj Finance Limited (‘BFL’) and Bajaj Housing Finance Limited (‘BHFL’) (referred hereinafter as ‘Lending Partner’) in sourcing of customers, providing preliminary credit support activities, fulfilment services and post-acquisition customer services related to lending business. Registered Office: Bajaj Auto Limited Complex, Mumbai – Pune Road, Akurdi, Pune – 411 035 CIN: U65923PN2014PLC150522