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What is a Business Loan?

A business loan is an unsecured loan taken to fund business requirements, such as working capital, expanding operations, adding equipments, inventory, events, projects, staffing, etc. You can borrow up to Rs. 1 crore on a flexible tenure and a fixed interest rate. To get the best loan on business offer, you can compare bank/NBFC offers on loanbaba.com and apply online within 2 minutes.

The website informs you about features and types of business loans, loan amount, interest rate offers, tenure, the eligibility criteria, documents required, and other essentials of the loan scheme.

Features of a Business Loan

Below-mentioned are some of the features of business loans in India.

  • Loan amount is between Rs. 1 lakh and Rs. 1 crore. The funds can be only used for business related purposes.
  • Interest rates start from 12.99%.
  • Tenure is between 6 months and 5 years.
  • No branch visit, you can apply online.

Points to Consider Before Applying for Business Loan Online

Here are some of the factors to consider before you apply for an unsecured business loan:

  • You should compare business loan offers and providers at our website to understand the best loan offer suited for your needs.
  • Know the annual percentage rate (APR), which is the total cost of loan in terms of annual interest rate.
  • Your current and past financial history will be a factor in determining your credit worthiness.
  • You need a good credit score to get your loan application approved. You can check your Credit score and report for free from CIBIL at our website and understand your business loan eligibility.
  • To get your application approved, you have to submit all the necessary documents. Know which are the documents required for business loan before you apply for the funds.
  • Understand all the terms and conditions for business loan online, such as interest rate, additional charges, repayment tenure, loan amount, etc.

Types of Business Loans in India

There are several types of loans for business that are provided by banks and NBFCs today. Some of the popular types of business loans are mentioned below:

  1. Unsecured Business Loan: Avail high loan amount up to Rs. 1 crore under this scheme. No security is to be kept with bank. This loan is for businesses that have at least 3 years vintage. The company has to satisfy the eligibility requirement set by the bank/NBFC in regards to annual turnover to qualify for the loan.
  2. Line of Credit: It is a revolving line of credit, where the borrower can take an agreed amount as credit to be drawn up whenever necessary. It is not a singular lump-sum payment. The borrower has to pay interest on the amount used, instead of the total amount.
  3. Bill Discounting:This scheme provides instant cash-back on bulk or large purchases by means of getting discount on credit sales. You have to submit important documents which justify the transactions, such as transportation receipts, invoice, lading bills etc.
  4. Business Loan for Women: There are special schemes for women who have exceptional entrepreneur skills. To be eligible for loan on business, the female must be an owner of at least 50 percent of the company. Such a loan can be provided at a discounted rate of interest.
  5. Mudra Yojana Business Loan: This business loan was launched by the government of India for small and medium sized enterprises. These loans carry special interest rates and are provided by almost every bank offering business loans.

Business Loan Eligibility Criteria

Below given are the eligibility requirements to apply for collateral-free business loan.

  • Banks and NBFCs provide the loan to self-employed individuals, professionals, service providers, manufacturers, private limited or limited company, etc.
  • The business must be registered.
  • The annual turnover must be over Rs. 50 lakhs.
  • The business vintage must be at least 3 years.
  • Minimum age of the applicant must be 21 years.
  • You have to submit Income Tax Return proof of the latest 3 years.

Documents Required for a Business Loan

If you want to apply for an unsecured business loan, then you have to provide the following documents:

  • Business Vintage Proof
  • 2 passport-sized recent photographs
  • Current/saving account bank statement for all current/saving accounts in PDF Format (latest 12 months)
  • GST Certificate
  • GST Returns of last 4 quarters
  • ITR for 3 years with computation
  • Audited Financials for 2 years - Balance Sheet and P&L
  • KYC (Pancard, Aadhar Card) - of Business /Directors/Partners/Proprietor
  • Shop Act/Gumasta License (if applicable)
  • Existing Loan Account statements/sanction letters.
  • Office Ownership Proof

Business Loan Interest Rates in India

The business loan interest rate starts at 12.99%. It is influenced by the following factors:

  • Your age and personal profile
  • Your Credit score
  • Repayment capacity
  • Financial position of the company
  • Loan scheme chosen
  • Relationship with the bank/NBFC

NOTE: To better understand the factors that impact a loan’s interest rate - click

Business Loans Interest Rates by Top Banks

Bank Loan Amount Business Loan Interest Rates* Lowest EMI per lakh for Max Tenure

SBI Bank

Rs. 1 Billion Max 11.20% - 16.30% Rs. 2,594 for 48 months

HDFC Bank

Rs. 50 Lakhs Max 15.50% - 18.30% Rs. 2,808 for 48 months

ICICI Bank

Rs. 40 Lakhs Max 12.90% - 16.65% Rs. 2,270 for 60 months

Axis Bank

Rs. 50 Lakhs Max 15.50% to 24% Rs. 2,405 for 60 months

RBL Bank

Rs. 10 Lakhs Max 20.00% - onwords Rs. 2,649 for 60 months

Kotak Bank

Rs. 75 Lakhs Max 16.00% - 19.99% Rs. 2,432 for 60 months

Capital Float

Rs. 1 Crore Max 18.00% – onwords Rs. 3,615 for 36 months

Lendingkart

Rs. 1 Crore Max 18.00% - onwords Rs. 9,168 for 12 months

Bajaj Finserv

Rs. 30 Lakhs Max 16.00% - 21.00% Rs. 2,834 for 48 months

Standard Chartered

Rs. 75 Lakhs Max 13.50% - 20.00% Rs. 2,301 for 60 months

Deutsche Bank

Rs. 50 Lakhs Max 24.00% Rs. 3,923 for 36 months

Edelweiss

Rs. 30 Lakhs Max 18.25% onwards Rs. 2,553 for 60 months

Business Loan EMI Calculator

EMI amount is a combination of both principal and interest component, which you have to pay every months towards repayment. You can use our FREE business loan EMI calculator before applying for a personal loan India. With EMI calculator personal loan, you can get the following details:

  • The right loan amount as per the annual turnover.
  • A suitable interest rate on the loan.
  • The ideal loan tenure.

Why Choose Loanbaba to Help You Find a Business Loan Online?

As a one-stop destination for your business funding needs, Loanbaba provides you a variety of business loan offers from top banks and NBFCs in India. Here is how you can ease your borrowing decision through our website.

  • Check Eligibility and EMI:Use business loan eligibility and EMI calculator to check your loan eligibility and EMI, within seconds.
  • Banks and NBFCs Offers in Real-time:Our online personal loan comparison tool will help you top banks and NBFCs for personal loan offers.
  • Grab Instant Quotes from Top Lenders:You will get instant quotes, interest rates, and offers from popular banks and NBFCs on our website.
  • E-approval Within No Time:You will receive instant approval of your business loan application if you have submitted the required documents and meet the fund-provider’s loan eligibility criteria.
  • Instant Support: We offer you a top-notch customer support. Our customer representatives will help you get the best loan deals at lowest rates. You can contact us on toll free number (18001038024), email (customersupport@loanbaba.com).
  • Guaranteed Privacy and Transparency:Your business loan application is sent to the bank/NBFC electronically, thus there is no risk to your privacy as information you share with us, is never shared with any unconcerned party.
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    Frequently Asked Questions for Business Loans in India

    1) How much time it takes to get a loan for business from banks and NBFCs?

    Ans: The time taken for loan amount disbursal varies from one financial institution to other. If you submit the documents in a timely manner, the loan can be processed faster. Usually it takes 3 to 4 days to process the loan.

    2) How to apply for a business loan?

    Ans: Apply for business loan online at Loanbaba:

    • Fill the loan application form on the business loan apply page.
    • Compare, select, and apply from top providers of business loans in your city and drop your loan application online.
    • No need to visit our office or bank/NBFC branch. All the procedure will be completed online.
    • You do not have to pay us any service fee. Our services are completely free-of-cost.

    3) Will the business loan carry fixed interest rate or floating interest rate?

    Ans: Most of the business loans carry fixed interest rates. However, in certain cases, a floating rate may be applicable. Check details of the loan scheme to understand the type of interest rate applicable.

    4) How to speed up the business loan application process?

    Follow below mentioned steps to get your business loan application processed faster:

    • You should maintain a good credit history and score. It will assist you in gaining trust of the financial institutions about your credit worthiness, and help in getting the loan application approved in a timely manner.
    • Apply for a loan amount that is suitable as per your repayment capacity. Banks and NBFCs study your financial profile and business’s annual turnover before approving a loan amount. If the amount required exceeds your repayment capacity, the loan application can be rejected.
    • Provide all necessary documents such as your residence proof, ID proof, age proof with the company documents. The documents need to be uploaded online with the application form.

    5) How to get a start-up loan?

    Usually, a traditional business loan is only offered if the business vintage is at least 3 years. However, you can think of alternative funding options such as a loan against property or gold loan to fund your start-up business.

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