The past decade has witnessed the rise and rise of entrepreneurial endeavors. The IT industry body, NASSCOM estimated that nearly 1300+ new startups came to fruition last year. In 2019, India observed $1.6 billion in early-stage funding for start-ups (1).
This rise can be attributed to the increased availability of funding options. While a growing number of entrepreneurs are opting for business loan to help their start-up dreams take flight, a number of established business owners are going down the business loan route to grow their business.
While applying for a business loan is a stressful and intimidating process for many, it can be streamlined and simplified by keeping a few key points in mind. Thus, to ease your application process and improve the chances of getting your loan approved, here’s a handy business loan checklist to get you started:
1. Is your business plan organized?
Banks quintessentially look for loan applicants who have an intricately detailed business plan. Your business plan must include your vision and the future goals you wish to achieve as a company. If you are able to showcase a proven track record of being able to utilize your funds, and execute your business strategy, financial institutions are more likely to approve your loan application. Hence, before you apply for a business loan online or offline, present a well-prepared business plan.
2. Know how much loan you need
Financial institutions keep a categorization of reasons for availing of business loans - ‘good reasons’ and ‘bad reasons’ - and depending on which reason you need the loan for, the banks are likely to classify your replies in either of the two categories. Unfavorable replies include acquiring unimportant assets for your business, building your office premises, and to finance your current losses. It is, therefore, necessary that you weigh your reasons and requirements well. Further, keep your financial estimates in check and prepare a budget for all your plans, prior to applying for a business loan. This is significant since underestimating your requirements will create a need for capital sooner than predicted, and overestimating it may lead to banks doubting your credibility and ability to repay the loan.
3. Is your credit score good?
Before applying for any loan, you must be aware of your credit score. Having a good credit score shows your creditworthiness and accelerates your business loan application process. Your credit score is measured on a scale of 300-900. To apply for a business loan online or offline, your credit score must be above 750. You must also note that while applying for a business loan, your bank or financial institution will check for your credit score. This is called ‘Hard inquiry’, owing to which your credit score may drop up to a few points.
4. Check your compliance of business loan eligibility
Here’s what you need to check:
- You must be an Indian citizen
- You must be self-employed
- Your age must be between 25-66 years
5. Check the documents that you need to submit
The documents required for business loan are:
- Your PAN Card
- Your Aadhar Card
- Proof of residence (utility bills)
- You must have business vintage for a minimum of 3 years
- You must have your income tax returns filed for at least 1 year
6. How to apply for a business loan online?
These days, applying for a business loan is easy and straightforward. There are many platforms available online with which you can apply for a business loan. Finserv MARKETS is one such platform, where you can get your business loan approved within minutes! Here’s how you can apply for a business loan online on Finserv MARKETS:
- Visit the Finserv MARKETS website
- Check your eligibility with the eligibility checklist given in the previous section
- Fill in the requisite application form
- Enter your required loan amount and preferred repayment tenure
- Wait for your application to be approved. Once your application is approved, the funds will be credited in your bank account within 24 hours!
The days when you had to wait for weeks to get your loan sanctioned are gone! With Bajaj Finserv Business Loan on Finserv MARKETS, you can avail of the business loan in a hassle-free manner. On Finserv MARKETS, you also have an option to choose your loan repayment tenure between 12-60 months. What’s more, you also get values added services like your personalized financial health check report to keep your financial well-being in check!
So tick off all the aforementioned items in your business loan checklist and proceed with your application for a Bajaj Finserv Business Loan on Finserv MARKETS.