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Types of Business Loans in India

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Types of Business Loans in India

In this competitive environment, business finance seems tricky, and business owners may often wonder about the best way to fund their business needs. Most businesses prefer Business Loans to meet their requirements because of the following benefits:

  • Easy Application
  • Large Loan Amount
  • Flexible Repayment Terms
  • Collateral-free Credit
  • Minimal Document Requirement

You can find several Business Loans in India. Opt for the one that best suits your situation for the best financing solution. Following are the five best business loans available in India:

1. Business Term Loan

It is the most common business financing option for entrepreneurs. Lending institutions can provide secured or unsecured term loans. The loan amount approved will depend on your financial behaviour for your previous debts. For instance, you can apply for a loan of up to 50 lakhs with Clix Capital to fund your high-cost investments. The loan repayment tenure ranges between 12-48 months with most lenders. The business loan provider will transfer the loan amount in a lump sum and take it back in monthly EMIs.

2. Working Capital Loan

Working capital loans are loans helping small businesses overcome the cash shortfall for their daily expenditures. It is an ideal financing option to deal with cash shortages during the off-season and meet increasing demand during the peak season for a business. Most service providers, retailers, traders, wholesalers, and manufacturers utilise business loans to get their business back on track.

3. Loan Against Property for Business

Small and medium-sized enterprises can obtain a loan secured against property for business requirements. You can raise funds for business purposes against your residential or commercial property. These are high loan amounts that can exceed Rs. 50 lakhs. The lender can provide up to 70% of the property’s current value in the market. Lenders follow a stringent process to check the property status. It must be free of litigation. Generally, these loans are long-term loans. You can also get unsecured loans if you want to remain mortgage free.

4. Overdraft

You can get an overdraft facility against securities or collateral, generally fixed deposits. It allows withdrawing the amount required from the approved loan amount. The borrower must pay back the loan and interest amount during the decided tenure. They need to pay interest only.

5. Business Loan For Women

Many financial institutions offer special financing schemes for businesses run by women entrepreneurs. With these specialised loans, you can take benefits such as discounted interest rates, and faster loan processing. The Indian government also offers many benefits to encourage small- to medium-sized businesses.

Conclusion

Online Business Loan providers can help you meet different business requirements. Choose the best business loan per your situation and fulfil numerous business purposes, including increased working capital, workplace expansion, office relocation, and business inventory or operational costs

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