Business Loans FAQs

Introduction

Business loans are loans taken by businesses or corporations without collateral. These loans are convenient for businesses to manage with the emergency monetary requirements. The procedure to get Business Loans is easier and quicker. Thus your loan will be sanctioned faster. Here are some frequently asked questions by our customers:

What are Business Loans

Businesses today face several challenges. One of those challenges is the requirement of collateral for getting the loan from financial institutions. Many small and medium scale businesses today do not have collateral for loans. These businesses can take a Business Loan. An unsecured business loan is given solely upon the creditworthiness of the businessman borrower. To be eligible for an unsecured business loan, the borrower should have a good credit rating, a good credit history and a good cash flow.

Why should you take a Business Loan?

  • Helps your business grow at a faster pace

By taking a business loan your business can grow at a faster rate. You can also finish any stagnant projects or ventures with the help of a business loan.

  • The value of the loan is not dependent on the collateral

When applying for a secured loan, the amount of the loan is dependent on the collateral being used. But while taking an unsecured loan, you may get a bigger amount of money because the lender is making decisions on the basis of your cash flow, credit profile, the health of your business and so on.

  • Faster Disbursement of Loans

As a business loan does not require collateral, the disbursement of the business loan is faster. The financial institution checks your documentation, proposal and track record and then sanction the loan. Less paperwork is required for unsecured business loans.

  • Repayment in EMI

You can repay the business loan in the form of EMIs. The interest rate will be applied to the EMIs over the term of the loan.

  • No risk to your assets

An unsecured business loan is a loan where no collateral is necessary. Thus, all your assets are safeguarded from any risks.

  • Eligibility Criteria for Business Loans

The Eligibility criteria for a business loan may differ depending on various financial institutions and the situation of the business. Here is a list of the general eligibility criteria for a business loan:

    • The business must have its previous year’s financials duly audited by a CA.
    • The borrower must have a good credit rating in order to qualify for an unsecured business loan. 
    • The business should have a vintage of at least 2 years.
    • The business needs to have its Income Tax returns filed for at least the past 1 year

How do you get a Business Loan?

Business Loans can be defined as loans given to businesses and corporations against any kind of collateral. It is one of the most convenient financial products for businesses to manage the emergency conditions of the business. 

  • Assessing the requirements of the client 

We at Terkar Capital will first understand the requirements of the client. We will also talk to the client about the future of their business, their plans to expand, restructure so on and so forth. After assessing the requirements of the client, we will make an application for the business loan. 

  • Application and Documentation

Many of the business people have experienced the tedious nature of the documentation need to be done for the bank loan process. We at Terkar Capital take care of the documentation. We understand what stakeholders require to disburse the loan to our clients.
Once we receive the required documents we analyse the financials of the company and choose the financial institutions which best suit the client requirements. This helps to avoid unnecessary inquiries to cibil and mess up while raising the finance.  

  • Get your loan

After your proposal and documentation has been reviewed by the financial institution, your loan will be sanctioned. During the process, whenever the financial institution is in need of any clarification or any documentation we arrange for them. Our association with the client don’t stop with the disbursement of the amount, rather it starts. We make sure the client should not have any problem while dealing with the respective financial institutions during the loan tenure. 

What are the Documents Required for Business Loans? 

Business loans are one of the most convenient types of loans for growing businesses. The documents required for Business Loans differ from one financial institution to another and as per the constitutions of the business. Here is a list of documents usually required for a Business Loan:

  • Documents Required for Public Limited & Private Limited Companies
    • 3 Years income tax returns, Balance-sheet, Audit Report of the Company
    • Company Pan Card, 1 Year All Current Account Banking shown in Balance Sheet Till date
    • All Directors KYC and 5 Photos
    • Shop act, Office Telephone and Electricity Bill Latest, MOA, AOA
    • Companies All Loan Sanction letters, Cash Credit sanction letter, Closer letters if exist
    • All directors residence telephone and electricity bill latest
    • Shareholding pattern on the letterhead of company attested by CA
    • Company Profile
    • GST returns till date
  • Documents List for a Proprietorship Firm
    • 3 years Income Tax returns, Balance sheet, Audit Report
    • Pan Card, 1 Year All Current Account Banking shown in Balance Sheet Till date
    • Proprietor KYC and 5 Photos
    • All Loan Sanction Letters and Closer letters, Track Record, CC Sanction Letter if exist
    • Shop-act, GST Certificate, Office And latest Residence Telephone and Electricity Bill
    • GST returns till date
    • Company Profile
  • Documents List for a Partnership Firm
    • 3 Years income tax returns, Balance-sheet, Audit Report of the Company
    • Firm Pan Card, 1 Year All Current Account Banking shown in Balance Sheet Till date
    • All Partners KYC and 5 Photos
    • Shop act, Office Telephone and Electricity Bill Latest.
    • Firm All Loan Sanction letters, Cash Credit sanction letter, Closer letters if exist
    • All Partners residence telephone and electricity bill latest
    • Shareholding pattern on the letterhead of company attested by CA (As on date)
    • Company Profile
    • Partnership Deed
    • GST Certificate & returns till date

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