Unsecured Debt Funding Youngsters and entrepreneurs of small businesses in India are known for their determination and innovative spirit. They possess a wide range of ideas and even have well-developed plans for their business ventures. However, a common hurdle that many businesses in India’s face is the lack of funding to kickstart their projects. Getting project funding seems quite a convenient option, but what if there is no collateral? In this case, businesses can obtain unsecured debt funding. There are several aspects to this kind of loan that matter in sanctioning a fund with no collateral. Defination Before putting forth a proposal, it is extremely essential to have a thorough understanding of unsecured debt funding. Unsecured debt funding is a loan provided to business owners without collateral. It is convenient for business expansion, reconstruction, or new ventures. Requirements must be met even without collateral. Unsecured Debt Funding Process In order to get this, there are certain parameters that will decide whether you are an eligible borrower for the same or not. The processing of unsecured debt funding takes place as follows: 1. Understanding Client’s Requirement: The first and foremost thing in the processing of the debt is understanding and comprehending what the client requires. As per the requirements, the financial institution figures out the details. The requirements such as financial strengths and weaknesses, future needs of the enterprise, and others. 2. Funding Proposal and Documentation: Once the proposal and the client’s requirements are comprehended, the documentation process will start. The borrower makes a plan and chooses a suitable option before documentation begins. Sanctioning the loan requires different kinds of documents. When this is complete, execution of the proposal shall begin and the loan will be sanctioned. As per the constitution of the business, (Sole proprietor or partnership firm, private limited company, or limited company), documents are prepared and submitted to the financial institutions. Since there is no collateral, the sanctioning of unsecured debt funding depends on the borrower’s credit score ratings, Business model, expected demand, etc such factors. There are other kinds of requirements as well. That will change and vary depending on the financial institutions, that have approached. Repayment of the Unsecured Loan Once the financial institution has disbursed, the borrower to liable to repay the interest. The interval of the repayment may vary from the financial institution to institution. Most financial institutions prefer to get repaid on a monthly basis. Few may offer a fortnightly basis, and few may offer a weekly or daily basis as well. The terms and conditions are very well explained in the sanction letter. So the borrower will always have the right to choose the right and most suitable options for him. How to Get Unsecured Funding? There are various financial institutions that grant unsecured debt funding. The debt market involves government banks and corporate banks, mainly. But still, there are other private unsecured business loan lenders in India who are lending a hand to enthusiastic and aspiring entrepreneurs. Also, it is essential that the private institution providing funding is trustworthy and maintains transparency of the process with the borrower. It is recommended that all the options and aspects are considered when choosing among unsecured debt funding. To summarize Terkar Capital understands the challenges faced by young entrepreneurs and small businesses in India when it comes to securing funding for their projects. That’s why we offer unsecured debt, a convenient option for those without collateral. With unsecured debt funding, business owners can obtain loans for expansion, reconstruction, starting new ventures, or handling short-term contingencies. While collateral is not required, there are still certain requirements that need to be fulfilled. Repayment terms vary, with most institutions preferring monthly payments.

Project Funding Overview India is full of talented and aspiring young minds. Among these are the blooming entrepreneurs and the visionary ones looking forward to expanding their enterprises. This has made project funding in the country quite ordinary and necessary. Since there are multiple agencies for funding, you must choose the right funding agency for the project proposal in India. There are several perks to project financing in India given the number of blooming businesses in the country. What is a Project Funding? Project finance involves funding viable and practical projects, and facilitating business growth, reconstruction, or new ventures. Indian entrepreneurs are increasing day by day. India also has half a billion SMEs. They are looking forward to the expansion of their businesses. Project financing aims at helping not only start-ups but also well-established businesses including SMEs. So, If you are looking for funding to help your business, you can approach the project financing agencies in India. How to get Project Financing? Multiple financial institutions are operating in the Indian Debt Market. However, not all of these organizations take exposure in project funding. The ones who are knee-deep in project funding are the government and the cooperative banks. So, each of them has its eligibility criteria for the sanctioning of the project finance. It differs as per the changes in the macro and micro scenarios. Before applying for a project loan, the applicant must have a cost baseline to support the financing proposal. Getting project funds can be complex, so choosing a reliable funding agency is crucial. Requirements As the name suggests, this kind of funding will be available only for projects. So, the project can start any new or existing business unit. Below are a few basic considerations for raising finance through project financing: Project Viability Analysis. Future Cash Flow. Mortgage Available. Payback Period of The Project. Key Personnel Profile and Relevant Experience. Location of The Project. Market Demand of The Product. And others depending on the project. Proposal Drafting a proposal need certain things. Some of the pointers are given as follows: a. Goals and Objectives The intentions and the goals that you have for the project that you are proposing must be mentioned clearly in your report. Thus, the objectives of your enterprise will make stakeholders believe or trust your project even more. b. Assets and Liabilities You must be able to mention the liabilities. The assets of the project in a way that stakeholder sees potential in your project. So, the assets must make an impact as the stakeholder is looking to provide funds to a project that has the capacity to generate enough revenue. c. Interest Rate It is an essential factor to consider. As it will also affect your repayment plan. Thus it is important that you provide an impressive project financing proposal. The rate of interest for project finance depends on several factors. They are as follows: Credit Score of Company Credit Ratings Risk Factors in the Project d. Traceable required proof The proof and the documents that you provide to support your project financing proposal must be traceable and it must also be – Measurable Consistent Complete Acceptable These are some of the aspects that will make your proposal looks good. And therefore increase your chances of getting the project finance. So, you must be careful with the way you spend your funds when you have them. Repayment Process The bank will provide the needed amount after the submission of the documents. The amount may be sanctioned periodically. And not all at once depending on the kind of project. The repayment of project finance is retrieved from the revenue generated by the project. Repayment begins after the first loan instalment is paid. In some cases, only the interest is paid for the first few days. In other cases, the interest is paid along with the principal amount. The interest rate on project funding is predetermined based on certain factors. The complete repayment structure is shown at the time of instalment. Learn more about the process of project funding through the case study. Project Funding Agencies in India Funding for projects in India is crucial for entrepreneurs and existing businesses. Government and cooperative banks are major funding providers. To secure funding, present a clear proposal and ensure it matches the agency’s criteria. Tailored repayment plans based on project profitability. While planning for project finance, one of the most important decisions to make is to find a trustworthy funding agency for project proposals. So, Terkar Capital is one such agency that is known for its legitimacy and reliability.