According to reports, around 80% of MSMEs are unable to access formal credit facilities, and they are forced to avail it from informal sources, which get more expensive in terms of repayment.
Therefore, to equalise this disparity, leading financial institutions have extended collateral-free loans in the form of a business loan to allow small and medium enterprises to access capital when required.
Nonetheless, being a business owner, you should know certain key pointers and features before availing of this credit facility to maximise its benefits.
Therefore, some of the essential pointers to know about this loan are elucidated below:
- Availability of an instant business loan eliminates the risk of losing ownership of a premium asset or property. Moreover, eligible business owners can get a substantial loan amount to meet various business-related expenses.
- Borrowers can avail of competitive interest rates and flexible repayment terms on their business loans if they possess a good credit score and maintain a low credit utilisation ratio.
- To ensure hassle-free repayment, borrowers need to opt for a flexible tenor that suits their intent and repayment capability. For this, borrowers can take help from a business loan EMI calculator to determine monthly obligations and interest amounts.
- Borrowers can also avail Flexi-loan facilities and withdraw necessary funds to maintain their business’s cash flow.
- Individuals can only avail their desired loan amount if they meet lender-specific eligibility criteria and produce necessary documents. Therefore, while availing of the loan, one must consider the qualifying parameters and maintain the documentation process.
Furthermore, individuals can also avail certain personalised loans from reputed financiers for specific requirements and entities like machinery loans, term loans, micro-loans, business credit for women etc.
Thus, prospective business owners can apply for a collateral-free loan both online and offline. However, it is wise to apply for this credit from trusted financiers to avoid unexpected circumstances.