Business Loan

Abfinance.in > Business Loan

Business Loan

1. Achieving High Business Loan Eligibility
Before applying for a business loan, it’s important to prepare a solid business plan, check your credit score, decide on the loan amount, research available business loan options, and gather all necessary documents.

2. Common Documents Required
To apply for a business loan, you’ll need to provide the following documents:

  • Proof of address & photo ID of the promoters
  • Business proof
  • Income proof
  • Partnership deed (for partnership firms)
  • Articles of Association (AOA)
  • Memorandum of Association (MOA)
  • Board resolution
  • PAN card

3. Criteria for Business Loan Approval
Applicants should meet the following criteria:

  • Age: Between 21 to 65 years
  • Business vintage: Minimum of 1-2 years
  • Minimum business turnover and annual turnover as per ITR
  • The business must be profit-making for at least the last 12 months

Features and Benefits of Our Business Loans
We offer a wide range of business loan options to suit different needs:

  • Term Loans
  • Working Capital Loans
  • Business Expansion Loans
  • Equipment Financing Loans
  • Invoice Financing & Bill Discounting
  • Machinery Loans

Business Loan Eligibility and Documents
Here’s a look at the criteria required to apply for our Business Loan.

Eligibility Criteria & Eligible Entities

  • Business Type:
    Loans are available for various types of businesses, including sole proprietorships, partnerships, LLCs, corporations, and others.
  • Credit Score:
    A good credit score is usually required for approval, as it reflects your ability to repay the loan.
  • Business Age:
    Lenders may require a minimum operational history, typically ranging from a few months to at least a year.
  • Annual Revenue:
    A minimum annual revenue is often required to show your business’s financial stability.
  • Collateral:
    For secured loans, you may need to provide assets such as real estate, equipment, or inventory as collateral.
  • Cash Flow:
    Lenders will assess your business’s cash flow to determine its ability to repay the loan.
  • Age Criteria:
    • Minimum age: 21 years at the time of loan application
    • Maximum age: 65 years at the time of loan maturity
  • Eligible Entities:
    • Individuals, MSMEs, sole proprietorships, partnership firms, public and private limited companies, LLPs, retailers, traders, manufacturers, and other non-farm income-generating business entities in the services, trading, and manufacturing sectors.
  • Business Vintage:
    Minimum of 1 year in operation.
  • Business Experience:
    Minimum 1 year of experience in the current business field.
  • Annual Turnover:
    Defined by the bank or NBFC.
  • Credit Score:
    A score of 700 or higher is preferred by most banks and financial institutions.
  • Nationality:
    Applicants must be Indian citizens.
  • Additional Criteria:
    Applicants must own a residence, office, shop, or warehouse.

Documentation for Business Loans
The documents required depend on your business type. Here’s a general list of documents needed to start the loan process:

  • ITR for the past 2-3 years
  • Current bank account statement for the last 12 months
  • Photocopy of PAN card
  • Address proof for residence (Voter Card, Passport, Aadhaar, Telephone/Electricity Bill)
  • Address proof for business (Telephone/Electricity Bill)
  • Provisional financials for the last year and projections for the future year
  • Company business profile on letterhead
  • 2 photographs of promoters and property owners
  • Sanction letter and repayment schedule of any existing loan
  • GST registration certificate and GST returns for the past 2 years
  • D-VAT/Sales tax registration
  • Udhayam Aadhaar registration certificate
  • Rent agreement (if property is rented)
  • Business continuity proof for 3 years (e.g., ITR, company registration)
  • Company PAN card, certificate of incorporation, MOA, AOA, list of directors, and shareholding pattern for private limited companies
  • Partnership deed and PAN card for partnership firms

How to Use the Business Loan EMI Calculator
A Business Loan EMI (Equated Monthly Installment) Calculator helps you estimate your monthly repayment amount. Follow these steps to use the calculator:

Confirm the details with your lender before finalizing the loan.

Enter the loan amount, interest rate, and tenure.

Click on “Calculate.”

View the EMI, total interest, and total repayment.

Adjust the loan tenure if necessary.

Consider any additional costs.

Ensure the EMI fits your budget.