With COVID-19 restrictions changing daily, every business person is under great deal of stress by disruptions in supply, lower cash flows and increasing overhead costs. Nowadays, many lenders are offering secured and unsecured business loans to keep your business healthy as well as help you to provide the customers, a quality services and products. Being a new business person, when you don’t have much of assets to pledge for loan, you can also “Apply For Business Loan“ without collateral.

Yes, such loans are called unsecured business loans especially for those who don’t have any assets to offer as collateral. It could be great if your firm is growing and you require funding to cover new costs. Collateral is a main difference between secured and unsecured business loan which have a great impact on loan terms which we will discuss in detail.

→ Loan Amount: As there is no requirement of security, the loan amounts sanctioned by lenders are small for unsecured business loans as there is more risk involved to default on payments where as secured loans will generate you a desired loan quantum.

→ Loan Tenure: Unsecured loans are always offered for a short tenure as compared to secured business loans. As there is more risk involved for lender to recover the loan money but if your repay the loan as per predetermined EMI schedule, you can secure other loan for longer tenure easily because of your trustworthy business.

→ Interest rate: Most of the lenders charge higher interest rate for an unsecured business loan than a secured one. Providing a lender with no security makes you more vulnerable to loss in case of default, for which they charge high rates to compensate for that.

There are some advantages linked to unsecured business loans which are mentioned below:

→ No collateral: A secured business loan always demands for some form of collateral but in unsecured loan, one does not require collateral. It means even if you default in case of such loan, one does not risk losing any security to the lender.

→ A chance to grow: If you don’t have any asset to provide a lender, it should prove as a barrier for your business. Therefore, unsecured business loans are great way to build a good credit score as well as these loans have shorter tenure, one can borrow small quantum, repay them quick and can secure another business loan qualifying you with larger loan amounts.

→ Quick processing: The loan processing and disbursal time for unsecured business loan is less as lender does not have to spend time in verifying the value and legitimacy of the asset you offer them. These business loans generally require minimal documentation which reduces its processing time. If you have a good credit history, strong business plan and business documents in hands, you can easily process a business loan within few days.

If you want to “Apply For Business Loan Online“ or offline, start your unsecured business loan application with ShubhBank today. You will experience a zero hassle and zero hidden charges on our business loans.

Securing a loan for your business is not an easy task but when the much needed funds are disbursed to you, you are able to recruit new employees, get your old machinery repaired, and purchase new equipment to keep your business operations running efficiently. However your journey while you “Apply For Business Loan“ is not easy as a walk in the park as it involves few hurdles but you can tide over them with a bit of guidance.

In this article, we will guide you about some of the obstacles that may come across while availing a business loan which are listed below:

Unable to meet collateral requirement: A business loan is a secured type of loan where most of the lenders ask for collateral against loan money. This is one of the major roadblocks in taking business loan especially for micro scale businesses as they don’t have much security to pledge. So, it is better to find a lender who offers collateral free loan where you can secure the funds without putting your assets on the line.

Unsuitable credit score: A credit score is one of the key factors to get through eligibility criteria that lenders will check to determine your creditworthiness and repayment capability. Thus, without a good credit score, lender may reject your loan application. This issue is common amongst small scale businesses and new enterprises as they have very little or no credit history. One cannot build a good CIBIL overnight, so layout a robust business strategy to convince the lender about your repayment ability.

Inconsistent cash flow: Every lender favors the loan applicants with a constant cash flow because it reflects your business health whereas lenders view uncertain cash cycles or inconstant revenue streams poorly. Therefore, try to optimize your cash flow before taking a business loan. It is advisable to keep your financial records and income statements duly updated to maintain a spotless profile. You can approach ShubhBank to “Apply For Business Loan Online“ or offline that requires a decent credit score.

Existing debt: If you have a pre-existing loan, lenders may not review your loan application positively. This is very common scenario for any enterprises with pre-existing loan as it reflects a high debt-to-income ratio which is a comparison of your total monthly installments to your total monthly income. There is not particular DTI ratio but the lower it is, the better it is. Make sure to pay back your existing loans timely which help you to build your credit score to enhance your loan eligibility.

If you really want to avoid such hurdles and quickly want your business loan to get approved for your requirements then avail a business financing from ShubhBank. We provide both secured and unsecured type of business loan solutions at competitive rates of interest, minimal documentation and flexible repayment period for maximum convenience. You can also use the loan EMI calculator to check your repayment potential. Visit us for business loan as it can be the key to the growth of your company.

In recent times, COVID-19 outbreak has changed everything terribly, from being quarantined and work from home, online classes to online shopping, making all this new normal for whole population. The corona virus pandemic has brought most of the countries to a complete stand-still, where everyone is going through a tough financial condition. Therefore, global economy has been fallen into the pit of recessions, these days. Thus, businesses are no less which have suffered the consequences of poor customer demand, fluctuation in supply and now have to face the adverse effects of this recession and on the way to restore their production to the supply chain.

So, all these prevailing conditions have put the most of businesses to look for funding options so that they can get back to the previous track. In India, one of the major business funding options, business loans are the popular one as many business persons go for it. Before you “Apply For Business Loan“ one of the most important things which a loan borrower should know is about the tax benefits on business loan. Availing any of the tax exemptions on your business loan can reduce your loan burden; let’s know in details about the tax benefit on business loan.

Interest rate is tax deductible on business loan: The rate of interest on business loan varies from lender to lender, where the loan money is categorized as an expense as it is being utilized in fulfilling business needs. Hence, the rate of interest paid to repay the loan quantum is claimed as tax-deductible expense. When the income tax is calculated on your business, then the interest rate paid is deducted from the gross income while the principal amount is never a tax deductible. Always try to maintain exact records of your business loan as if you are asked by the income tax department to submit the associated proofs.

Some other tax benefits on business loan
√ The interest amount on business loan is tax exempted.
√ The principal on business loan quantum is never tax deductible.
√ While filing your income tax, interest rate paid on business loan needs to be deducted from the gross earnings.
√ Usually, the tax liability is calculated by cutting down the business expenses from the gross business earnings.
√ One needs to fulfill the required eligibility criteria to avail the tax deduction on business loan.

You must remember while you “Apply For Business Loan Online“ or offline that it is a type of funding provided by any of the traditional lender or NBFC, so it cannot be counted in your income. Therefore, it is not tax-deductible. Generally, loans against business do not alter what one owes in taxes because according to Income Tax Act 1961, getting funds through borrowing isn’t the same as earning funds for the business. So, the interest rate levied of the loan against business is considered to be tax-deductible while the principal money is not tax-deductible. However, one can enjoy the tax benefits on business loan but there are some rules to be followed.

If you are planning to own a successful business or you want to grow your ongoing business, therefore, figuring out to start a profitable firm needs to raise the funds for your business product. There are number of reasons for which your needs funding such as need to purchase new machinery, pay wages to the employees, land purchase to set up the production unit, to buy an office or it can also be needed to expand the existing business or to consolidate the existing debt.

Initially, a business person need more funds to build up sales and one will need money to maintain the cash flow and to pay salaries. Now, the question arises where do you get these funds from? There is a large lending sector for potential business loans, these days. In our country, business plays a crucial role and contributes highly in the GDP of country. The small and medium businesses mainly contribute 95 percent of the industrial units in India. The demand of “Business Loan“ is increasing by each passing day. Hence, lending institutions are making it easier to apply for business loan and get instant funding.

In this article, we are providing you with some tips which will tell you, how to pick a right business loan for you:

⇒ Type of Loan: In lending sector, there are different kinds of business loans available which include term loan, working capital loan, business line of credit, equipment loan or small business loan. Therefore, to avail the maximum benefits, one first needs to decide which loan you require. If you need to upgrade the machinery, you can go with equipment loan and if you need to remunerate the employees or want to expand your existing business, you can avail a working capital loan. You can research and knowing your options will help you to opt for the best-suited scheme.

⇒ Right business loan lender: When you need to “Apply For Business Loan“ you will find innumerable lenders offering number of benefits. Many of the lenders approve and disburse the loan quantum easily whereas many of them take time to deliver the money. If you really want to grab the best option for yourself then do not trust any random lender easily. Finding the right lender may take some time so go through different lenders and compare the interest rates and read the customer reviews. Once you find the right lender, you can go ahead to take a loan.

⇒ Documentation: When you avail a business loan, the lender will ask about your cash flow to be sure about the repayment capacity. It is your responsibility to provide the correct details of everything to avoid the loan rejection. Try to find those lenders who have minimum set of eligibility criteria along with less paperwork.

Selecting a right business loan is very important for a particular business’s success. There are varieties of online lending platforms which will help you to assess the different business loans offered by various lenders. Selecting the right loan product can also add the growth to your business exponentially.

Taking out a business loan has its own pros and cons but one have to balance the benefits of receiving the funds to grow their business with factors like hidden fees, strict tenure and added interest. Applying for a loan is a big decision and it is always advisable to make a checklist to ensure that you are filing the application efficiently as it may include a lot of required paperwork. In this article, we will discuss about how to get ahead with business loan application checklist to expand your knowledge on a deeper level. Now check off the individual factors listed below before making a file for your business loan application.

-> Borrower Profile: There is a borrower information form which is used to fill out the borrower’s profile interested in taking a loan. It includes some details related to loan seeker’s contact information, business principles, loan intent, company’s profit and loss or any outstanding loans.

-> Personal and Financial Background: If you are a business owner or general partner, you’ll have to complete a personal and financial background statement. Generally, every lender wants to ensure that the personal credit score provided by you is legitimate before approving you the loan money to improve your business. This form requires your personal details like phone number, address as well as declaration of your financial assets, giving the lender an idea of your current approximate net worth.

-> Financial Statement of Business: Business Financial Statement reflects your company’s income, expenditures and how you manage the working capital. It can be a great opportunity to make sure that your intended revenue is adding up. Therefore, before you “Apply For Business Loan“ create a business financial statement that includes all the assets and liabilities as they pertain to your business finances.

-> Income Tax Returns: The income tax return is the important key to get approved for a loan. To complete the checklist, you’ll need to provide the income tax returns for the past two or three years. Before submitting it to the lender, make sure to sign it and to feature the correct information.

-> Business History: A business history is an important aspect of your application checklist which is used to communicate your business visions and goals. It is significant as the lender want to know how you’ll your business loan money and asks for layout of your business plan to verify legitimacy. Nowadays there is an option of “Online Business Loan“ that most of the lending institutes are providing to their customer to save their valuable time and to run out their business operation smoothly as applying online loans will get you the quick approvals and faster disbursal.

-> Legal Documentation: It is smart to carry any legal documentation pertaining to your business as lender could request for it any time. You will need an additional legal documentation such as articles of incorporation to legal agreements and contracts at some point in your journey for getting a business loan.

ShubhBank offers affordable business loans for small and medium sized enterprises with the view to address their working capital requirement. Business owners and entrepreneurs can fulfil their business expression goals and meet all their working capital needs using the ShubhBank business loan. Our loan is designed in such a way that they suits the needs of most businesses that are looking for funds to help them operate and grow. It can be uses for a variety of purposes by the company. They can either be used to fund expansion of current operation or to provide resources for new projects that a company may wish to take up. It can also be procured by enterprises engaged in manufacturing, services, retail or wholesale trade activities. Self employed professionals and individuals, closely held limited companies, private limited firms or eligible to “Apply For Business Loan“. Our bank offers various facilities that can range from easy repayment options to doorstep service. We also offer quick approval times and minimum documentation to make the loan easier to take.