Getting a business loan can be challenging if you don’t know where to start. So, we break down how you can get a business loan easily. Then, we cover the steps you need to take and recommend ideas so it’s easy for you to avail of a business loan.
Running a business is a complex endeavour that involves ideation, strategic planning, and financial management. Unfortunately, many businesses struggle to secure the necessary funding to realise their potential, despite having a solid foundation.
So how do you get finances as a new business? One such option is through business loans. Business loans make it easy for you to achieve your entrepreneurial dream without worrying about finances. Wondering how you can apply for a business loan easily?
Keep reading to find out how.
Steps To Get a Business Loan Easily
Here are the various steps involved in applying for a business loan.
1. Fulfill Eligibility Criteria
While different lenders will have different rules, here are the standard eligibility criteria you need to fulfil-
- The minimum age of the applicant must be 21 years
- A minimum credit score of 680
- Your business should be running for at least 2 years
- Your business must show healthy statements of profitability for two years
- You must have a minimum turnover of Rs. 1 crore in the latest financial year. You must also audit the finances.
2. Have a Solid Business Plan
Since business loans are typically high-value loans, lenders will ask you for a lot of information. This means that you have to prepare yourself well in advance before approaching a lender, especially with a solid business plan.
You must show the lender how you will use the money from the loan. Hence, you’ll have to show your present and future plans to the lender to get a business loan easily. By preparing a solid business plan, you’ll be one step closer to getting your business loan approval.
3. Know How Much You Need
Businesses may think of future expansion prospects without coming down to an actual number. But this can hurt your prospects of availing of a business loan. So, when you plan to take out a loan, know the required amount before getting in touch. This can also help you make a more informed decision and avoid borrowing more than you can afford. Also, by not taking an amount that is too low or high, you can ensure that you’re justifying the entire amount without overspending or being cash-strapped.
Once you have determined the loan amount, get in touch with a reliable banking partner like IndusInd Bank to apply for a loan online through a simple application process.
4. Check Your Credit History
It is a well-known fact that companies prefer people or businesses with a good credit history. But there may be times when you would have missed out on paying back loans. This would have reduced your credit score by a few points, and it may be a challenge to get it back up. So before applying for a loan, check your credit score and take the following steps to improve a low credit score-
- Keep your utilisation rate below 30%
- Check how much debt your business has. See if you can repay that debt before applying for a loan
- Have a longer credit history. This shows to lenders that you are a stable business that has the capability to repay the loans
- Provide Documentation
Along with this, you must submit the necessary documents, including your personal and business details, bank statements, business financial statements, and so on, to complete the loan application process. Once that is done, the bank will verify your details and approve the loan within a few days.
IndusInd Bank offers you attractive business loans at competitive interest rates and flexible repayment terms. Build your dream business without worrying about capital needs. Get in touch with IndusInd Bank and apply for a business loan today!
