Whether you are setting up a new business venture, expanding an existing one or funding marketing and advertising campaigns, it is essential that you fund your business well to ensure its continuity and growth. Business loans are an excellent way to achieve this objective and stay afloat in today’s highly competitive environment. But, are you aware of the pre-requisites when applying for a business loan?
Apart from a robust business plan and some initial documentation, there are other factors that are also taken into consideration by financial institutions when deciding whether to approve your application or not.
In this article, we have detailed some important factors that affect your business loan application. Here are a few things you must know while applying for a loan:
1. Application form
Although the primary application form may vary from one financial institution to another, there are some basic information required that you must be aware of:
Purpose of the loan
This is essentially a part of the business plan which clearly highlights the objective / goal that needs to be achieved with the money being borrowed. For example, the additional amount would help the organization to achieve double revenue target.
Income and existing debt liabilities, if any
Transparency is key when applying for a business loan. Hence, this section would need to detail out existing income / revenue details along with any liabilities / existing loans, credit card accounts, accounts receivable etc. In simpler terms, these are essentially nothing but your balance sheet and P&L statements or financial forecasts in case of new business.
Financial and personal background
As a business is only as good as its founder, it is very important to know more about the individual backing the business venture as a business is only as good as its founder. An individual will need to provide all necessary details including (but not limiting to) educational qualifications, experience, financial details etc.
End use of borrowed amount
It is also very important for the financial institution from an accountability perspective to know as to how the funds will be utilized. It is essentially a part of the business plan which clearly defines where and how these funds will be utilized and its impact on business financials.
2. Credit rating
Most financial institutions will check your credit score / credit rating when you apply for a business loan. It is therefore important that you understand and review your credit score before submitting your application form. It not only helps you gauge your credit health but also gives you an opportunity to rectify any errors that may affect your application process.
Some basic documents that must be submitted along with the application include (but not limited to):
- Address and Identity Proof (Aadhaar Card, PAN Card, Passport, Driving License etc.)
- Bank Account Statement (The time duration of the bank account statement will vary from one lender to another)
- Financial statements such as profit and loss account, balance sheet, cash flow statements etc.
It is advisable you keep all the required documents for business loan ready before submitting the application.This ensures a smooth and swift application process as well as money disbursal.
Applying for a business loan at Finserv MARKETS is easy, convenient and has several benefits. Some of the key benefits of business loan are listed below:
Transparency is of the utmost importance at Finserv MARKETS. Our website lays down all terms and conditions, application fee charges and other important information upfront to ensure the individual that there are no hidden fees / charges.
Every business has unique needs and the ‘one-size-fits-all’ solution may not work for you. Our team of experienced professionals can help deliver a customized solution that is not only robust but also suits your business goals and needs.
6. Quick procedure
You may directly apply for the loan online through our website. The entire procedure takes a few minutes to complete and once approved, funds will be transferred to your account with quick disbursal guarantee.
7. Minimal documentation
With Finserv MARKETS, say goodbye to tedious procedures & long waits. You only require basic documentation which you can submit online along with all the other information. Funds will be disbursed once all the information is reviewed and approved by the Finserv MARKETS team.
8. Higher loan amount
We offer a loan up to INR 15 lakh. This ensures that you are able to meet the fund requirements of your business for smooth operations, continuity and growth.
9. Longer tenure
Our loans are available for a time period between one and five years. Therefore, you are able to choose between either a short-term or a long-term loan based on the financial requirements of your business.
Apply for a Bajaj Finserv Business Loan at Finserv MARKETS today and manage your finances without any hassles.
“Finserv MARKETS, from the house of Bajaj Finserv is an exclusive online supermarket for all your personal and financial needs. Loans, Insurance, Investment and an exclusive EMI store, all under one roof – anytime, anywhere!”