In India, while the large multiple corporations dominate the stock markets, the small businesses provide maximum assistance in keeping the economy moving. They not only foster growth and innovation in the community or the environment in which the business is set up, but also support the economy on a larger scale by generating ample employment opportunities. However, what really weighs them down and acts as a barrier in their expansion is the lack of funds. Whether it is to grab a short-term growth opportunity, cover debts or to purchase advanced equipment, small businesses need quick access to funds to stand strong in the highly competitive markets.
To deal with such issues, nowadays, there are various financial institutions that aim to promote small and medium-sized businesses with the amazing option of small business finance. India with this easy financing option has now successfully created an environment where small businesses can grow and flourish while making a significant contribution to the national economy. All you have to do is search the markets for the most reliable lender to get the loan at a low interest rate and with a flexible repayment cycle.
What are the benefits of taking small business finance?
Easy and quick documentation – With the continuous progress in the digital world, today, it is no longer difficult to apply and receive approval for a business loan. Many financial institutions have moved the entire process online so that you can raise the funds with minimal steps.
Attractive interest rates and low charges – The interest rates on these loans are generally low as they are provided to help small businesses expand and grow. However, the interest may get affected by the factors such as the credit score of the borrower, debt-to-income ratio and tenure of the loan as they all decide the borrower’s ability to timely repay the loan. Once approved, a nominal one-time processing fee is charged.
Flexible repayment structure – Usually, the borrowers are offered a flexible repayment option in the case of small business finance. India now has plenty of money lenders who offer well-customised solutions to all small businesses who are in need of an influx of funds. Based on the credit history as well as the condition of the business, the lenders may get ready to negotiate the conditions in terms of the interest rate, EMI amount and tenure of the loan.
Eligibility criteria for small business finance
• The minimum age of the borrower should be 21 years and the maximum age should be 65 years at the time of loan maturity.
• The business should be generating profits for at least the last two years.
• The borrower should be in the same area of business for at least 3 years and should have at least 5 years of business experience.
Conclusion
To sum up, every small business enterprise can greatly benefit from the facility of small business finance. India has quite a few financial institutions that offer a low interest rate, flexible repayment structure, easy documentation, and most importantly have simple eligibility criteria. All you have to do is compare multiple lenders and their terms in order to select the most dependable one.