Business LoanSME Loan and Start-up Loans

Business Loan/SME Loan and Start-up Loans

The amount borrowed must be returned to the lender as principal and interest, but every loan is unique. Rajesh looked for a business loan when he wanted to launch a new venture. His friend Karthik clarified the distinction between a business loan and a loan for a unique experience.

Unique SMEs, Unique Needs

The typical range of SME/Business Loans is Rs. 5 lahks to Rs—50 lakh. FINTITUDE helps to apply these loans to those who want to start a business or expand an existing one. Any minor- or medium-sized business owner, such as one operating a small manufacturing, restaurant, or trading operation, may apply for one of these loans.

The borrower must age should be more than 23 yrs, have run a successful and stable business for three years, and have a history of filing taxes to be eligible. The loan term typically ranges from 12 to 48 months.

The interest rate on SME/Business loans typically ranges from 18% to 24%. The financial and business profile determines the actual rate.

New ideas, new start-ups

Securing funding for a start-up is one of the most complex challenges an entrepreneur faces when starting a new business, even though start-up companies can take advantage of term loans, working capital, or asset-backed loans depending on their needs. With so many funding options available, the entrepreneur must weigh the benefits and drawbacks of each funding methodology, calculate the amount of money needed, apply for the funds, project the business’s future financial position, including any returns, and develop a strategy for approaching and securing the money. Many entrepreneurs are unaware that financial institutions and banks are other sources of financing for start-ups because venture capital firms and angel investors are frequently mentioned as excellent sources of capital for startups. In India, banks are one of the significant sources of startup funding, giving money to thousands of businesses each year.

To be eligible for start-up loans, the unit must be qualified and certified as a “Start-up” by the relevant government authority through the Start-up India scheme. Loans of up to Rs 5 crore are available to support the creation, testing, and commercialization of novel goods, systems, and services.

Additionally, start-up loans are available for financing equipment purchases or as a line of credit (LC). Interest rates for a Line of Credit are typically higher if no security is needed. When a business is just getting off the ground, loans are given for the financing of equipment, and the tools and equipment used for the company are pledged as security. The interest rate would therefore be lower than if there was no collateral financing.

Points to ponder upon for any business loan It’s essential to comprehend how to estimate your repayment capacity and EMIs regarding business loans. You can use the financial tools provided by FINTITUDE.

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