FAQ- BUSINESS LOANS

FAQ’s

  1. What is a Business Loan?

Business loans are taken for the purpose of business expansion and for growth of business.

2. What is the maximum loan amount I can apply for?

Usually, it depends on the borrower’s profile. Lenders offer loans starting from Rs. 50,000 upto Rs. 5 Cr. In MANTRA we can help you get loans as per your requirement.

3. What will be the rate of interest for my business loan?

The rate of interest is decided on the basis of various factors such as your annual turnover, banking transactions, business proof (proof of continuation) and your credit score.

4. What is the eligibility required for applying business loan?

The applicant must have own at least one year business running in profit. One year ITR should be compulsory filed by applicant.

5. What is the minimum CIBIL score to get a business loan?

Generally, 750 and above is considered a good credit score to avail business loan. Higher the credit score, lower the interest rates.

6. What is the maximum tenure for a business loan?

Generally, the tenure ranges between 12 to 60 months.

7. What are the different types of business loans?

Following are the types of business loans-

  1. Working Capital Loan
  2. Term Loan
  3. Equipment Finance
  4. Loans under Govt. schemes
  5. Loans for women.

8. Who can get business loans?

Business loans are offered to both professionals and non-professionals. This loan is offered to:

Sole Proprietorship

Partnership Firm

Private Limited Companies

Closely held Public Limited Companies

Societies

Trusts

9. Is business loan given to Startups?

Yes, start ups in India can get business loans. Many lenders offer loans up to Rs.45,00,000.

10. What are the types of startup business loans that are available?

For startups, lenders offer business loans as Term loans and working capital loans. While term loans are given for expansion of business, purchase of machinery, launching new projects etc, working capital loans are given to stock up inventories, pay rent, pay employees salaries, renovate office etc. These loans can be taken for a period of 1 – 10 years.

11. Which banks offer business loans for start ups?

In India, many lenders offer loans to startups to help them fund their business. Some prominent lenders are HDFC Bank, Bank of Baroda, CITI Bank, ICICI Bank and State of Bank of India.

12. Does government also provide loans to startups?

Yes, there are government loans that you can avail for your startup business. Some of the government loans you can avail are:

• Mudra Loan Scheme.

• MSME Business Loans in 59 Minutes.

• The Credit Guarantee Scheme (CGS).

• Stand Up India Scheme.

• Coir Udyami Yojana.

• National Bank for Agriculture and Rural Development (NABARD).

• Credit Link Capital Subsidy Scheme.

• National Small Industries Corporation Subsidy.

13. What are the minimum documents required to avail business loan?

Documentation refers from banks to banks and NBFC’s to NBFC’s.

Minimum documents are- KYC’s, Business Vintage Proof, Banking, One year Income Tax.

14. How can I repay a business loan?

You can repay your loan EMIs through Post Dated cheques, Electronic Clearance Service (ECS) or Direct Debit.

15. Do I need to provide a collateral or security to avail a business loan?

Since business loan comes under the category of unsecured loans therefore you do not have to provide any security or collateral to avail this loan.