Now fulfilling your dream to establish your own business is not an issue to worry about. Because there are almost every government and non-government banks in India which provides loan for business with affordable interest rate and flexible terms and conditions.
Business loans are basically those loans which are being provided to help the traders and entrepreneurs to built up or renovate their businesses. Apart from the businessmen and traders the self-employed are also enjoying the facility of getting these loans. There are certain criteria like the financial position of the business, past loan repayment record and loan repayment capacity, if the business fulfils these criteria then it will be eligible to get a loan for business.
These loans are broadly classified into two types – secured and unsecured. In India, usually the secured loans are being provided for those persons who own their own homes. Because if the person will not be able to repay the loan amount the banks will get the option to recover the loan amount by selling the home. If you are planning to set up your own business then going for the secured business loans would be the best route for you. Though you have to keep your property as security to the financial organisation, but you will get a very low interest rate and long repayment period comparatively to the unsecured kind of loans.
Under the unsecured business loans, the borrower doesn’t have to keep anything to the bank as the security. But he doesn’t get the facility of an affordable interest rate and flexible repayment. As the risk is much more higher than the secured loans the banks also cannot give the borrower a high repayment period.
For the self employed professionals like Doctors, Chartered accountants, Interior Decorators, Architects, Company Secretary the best category of loans are the professional loans. They can avail these loans without keeping anything to the financial organisation. Banks generally provide
loan from Rs.25000 to Rs.25 lakh under this category. It depends on several factors like the repayment capacity of the applicant, financial standing of the customer, tenure of the loan etc. Banks generally provide. The repayment has to be done through Equated Monthly Instalments or EMI. Banks do charge the rate of interest according to the prime lending rate. Under this loan the borrower can avail the loan against a fixed or fluctuating interest rate. Though the interest rate depends on the profile of the customer and the financial capacity of him.
On the other hand, banks provides different types of loan for the traders and business persons. The terms and conditions are different from the professional loans. Because in these loans there is a involvement of heavy initial investment. These loans are being provided to set up or expand business. Under this category the minimum loan offered by banks is Rs.25000. One can maximum avail Rs. 100 lakhs. Though the amount of loan completely depends on the financial standing of the applicant, his ability to repay the loan, age of the applicant and the tenure of loan. One can have the option to repay the loan amount in maximum five years through Equated Monthly Instalments. Under these loans the rate of interest is usually fixed at the financial organisations and it is charged on the basis of prime lending rate.
There are lots of banks in India which provide loan for business. But some of the top choices are United Ban