Business loans are a great way to leverage your enterprise and meet immediate fund requirements. Small and Medium Enterprises (SME) are usually dependent upon business loans to meet their funding requirements. With the advent of technology and digitization of processes, even the loan application has become online. However, while applying for a business loan online, even though it may seem easier and convenient, applicants may face some common challenges like fulfilling eligibility criteria, good CIBIL Score, sufficient documentation, etc. Here's a guide to help you overcome those challenges while applying for the business loan online:
Each lending institution has its own eligibility criteria for sanctioning the loan application. Satisfying these criteria is essential; otherwise, lending institutions may outrightly reject the loan application. Therefore, it becomes important for the applicant to fulfill that eligibility criterion to get the funds in their bank account. While basic SME loan criteria and eligibility are the same in most cases, certain considerations may differ among lending institutions. As the eligibility criteria are available online in most cases, the applicants may go through the same to determine whether they fulfill the requirements.
Business loans are usually unsecured. Therefore, the interest rates are generally a little higher as compared to secured loans. Interest charged by the lending institutions is typically dependent upon various criteria like adequate documentation, fulfillment of all the eligibility criteria, CIBIL score, and the applicant's profile. Satisfying SME loan criteria and eligibility and all these requirements may become challenging yet essential to secure a lower interest rate. Therefore, it is usually beneficial for the borrowers to compare the interest charged by the various lending institutions and select the most affordable ones. However, it is always in the applicant’s best interest to consider other terms as well, along with the SME loan interest rates.
Shriram City business loan interest rates are some of the most affordable ones considering the needs of the business owners. It starts from just 15% per annum. This, combined with simple Shriram City SME loan eligibility and criteria, makes borrowing convenient and straightforward.
Borrowers should be clear with the terms of the business loan before applying for the same. Different lending institutions have different terms for SME loans, and therefore, borrowers should compare before application. Common terms include processing fees, tenure of the loan, closure charges, repayment flexibilities, etc.
Shriram City charges less than 2% processing fees and provides a loan tenure of up to 60 months. The applicant becomes eligible for loan closure after 6 months with nominal charges of 3% to 6%. It provides flexible monthly repayments to the borrowers.
Documentation becomes an integral part of the loan application process. It forms the basis upon which the bank gets to know the information about the applicant and his business. Fulfilling all the documentation requirements of the banks may be a bit challenging, considering most borrowers don’t have all the documents handy. Inadequate documentation may result in high-interest rates and other costs. Basic documentation requirements are the same among different lenders. These normally include:
A good CIBIL score becomes an important criterion to determine the eligibility for a loan. Without a good CIBIL, you may have a hard time getting your loan sanctioned and disbursed. Therefore, if not satisfactory, the CIBIL score may become another challenge to your loan application. It is the parameter based on which banks determine the creditworthiness of the borrower. CIBIL score forms part of the CIBIL report that shows the record of your credit performance, including repayment delays, defaults, and hard credit inquiries. Therefore, regular repayment of loans ensures a healthy CIBIL score that makes it easier to avail financing in the future.
However, a lower CIBIL score may fail to fulfill the eligibility criteria of the lending institutions. Shriram City specializes in providing loans to individuals with a low credit score who face difficulty entering financial arrangements with formal lending institutions.
You can preplan your business expenditure by knowing the exact amount of EMI you will need to pay if you enter a business loan arrangement with your bank. The business loan EMI calculator is also a great tool to predetermine the EMI amount. You just need to enter the loan amount, SME loan interest rate, and the tenure for which you are willing to borrow. EMI calculator will derive the exact amount of EMI you will be required to pay.
SME loans are frequently-entered arrangements by business owners to maintain liquidity and meet working capital needs. Specific emergency funding needs may arise, which might necessitate taking a business loan. Being unsecured, business loans have a wider reach among the business owners to steer their business smoothly on to the growth path. The needs of most business owners and MSMEs are catered with the most affordable Shriram City Business loan interest rates. The applications can be made online to streamline the entire loan process and faster approval and disbursements. This reduces the hassle of physical processes that used to be time taking and cumbersome.