Business Loan FAQ
What is a Business loan?
Business loan is a 1-3 year unsecured loan given by banks, NBFC or P2P lending platforms without asking for any collateral, guarantor or hypothecation of any assets. Entities like proprietorship, partnership, private limited company or public limited company are eligible for this type of borrowing. The usage of a business loan is left to the discretion of the borrower and can be used for working capital purposes, meeting short term cash flow requirements, investments into plant and machinery etc.
Who are eligible for Unsecured Business Loan?
The general factors taken into account while determining the eligibility of Unsecured Business Loan are listed below:
- Age (Min. 21 Year)
- Maximum 58 age at time of closure of the loan for the salaried.
- Maximum 65 age at time of closure of the loan for the self-employed.
- Total work / business Experience 3 yrs
- Indian resident
Who can avail a Unsecured Business Loan?
Following are the list who can avail for Unsecured Business Loan which is as follows:
- Self Employed Individuals/Professionals
- Proprietorship Firms
- Partnership Firms
- Private Limited Companies
What are the loan tenure options for Unsecured Business Loan?
Business Loan generally is available for 1year to 3 Years. But some Banks and NBFC’s give it for 5 years
How much amount can I borrow in Unsecured Business Loan?
It mainly depends on your financial profile, credit reputation, the purpose of borrowing the loan and your loan repayment ability. Lenders evaluate these factors to consider what the amount of a Unsecured Business Loan should be.
Is The Interest Rate, Fixed Or Floating?
We deal with fixed rate of interest.
What is the mode of repayment?
You can repay through either Post Dated Cheques or ECS.
What is a Business Installment Loan?
Business Installment Loans are the loans, which are used to meet medium term working capital needs.
How can I repay my Business Loan?
You can repay the loan in equal monthly installments (EMIs). The loan can be repaid through post-dated cheques. You can also repay through an ECS mandate to your bank.
Do I need to hypothecate my assets or provide any other collateral to avail a Business Loan?You do not need to hypothecate any assets to avail a unsecured Business Loan.
What are the drawbacks on applying for Unsecured Business Loan online?
Applying online Unsecured Business Loan will give you information about particular bank. And if you apply through us our professionals will get exciting offers from banks for better rate of interest, foreclosure charges, tenure and processing fees.
How long does it take to disburse the business loan?
Makemyloans.com will work with the concerned bank and get you the loan within 5-7 working days of your submitting the completed documents
How will the loan be disbursed to me?
There are two modes for this: Either NEFT/RTGS or cheque as per your convenience and preference.
Is pre-closure allowed in business loans?
Some banks have a lock-in-period of six months to one year for the business loan.. Some banks may have a rule that a borrower can use his own funds to pre-close the loan and not use the balance transfer facility of another bank. Additionally, some banks allow pre-closure at no cost while some others charge an upfront fee of 2-5% of the pre-closed amount. Clarifications on this are to be sought from our business loan advisor during the processing of your application.
What happens if there is an ECS bounce or I miss an EMI payment?
The bank will levy certain ECS bounce charges. Additionally, that will also get reported in your credit report. It may have a serious impact on your future credit possibilities like in obtaining other loan.