Maximize Your Chances: 12 Smart Tips for Getting a Small Business Loan

When it comes to accelerating your business' growth, nothing comes close to the speed and availability of opting for a Business Loan. Particularly today, when companies like Poonawalla Fincorp manage their entire loan application process online and provide collateral-free loans to their Business Loan borrowers. The trick then is in ensuring that you are perfectly prepared to apply for the loan so that there are no possible delays and hurdles at your end.

Here are 12 Smart Tips that will ensure that your loan process is as smooth as can be:

1. Research Lenders: Before you apply for a small Business Loan, research different lenders in the market to find the one that best fits your needs. Compare their interest rates, repayment terms, and fees to find the most suitable option.

2. Have a Solid Business Plan: A detailed and well-thought-out business plan can help lenders understand your business potential and increase your chances of getting a loan approval.

3. Improve Your Credit Score: Your credit score plays a crucial role in your loan application's approval. Make sure to pay off any outstanding debts and bills and check your credit report for any errors, and if any, get the issue rectified with the credit bureaus before making any loan application.

4. Determine Your Loan Amount: Have a clear idea of how much money you need for your business and the purpose. This will help you select the right loan amount and lender.

5. Consider Collateral: If you have valuable assets, such as equipment or property, consider using them as collateral for the loan, if required by the lender to be pledged with them as a loan security. This can help you secure better terms and interest rates.

6. Gather Necessary Documents: Before applying for a loan, gather all the necessary documents, such as KYC, company registration details, financial statements, tax returns, and business licenses.

7. Be Prepared to Explain Your Financials: Lenders will want to know about your business's financials, such as your revenue, expenses, and cash flow. Be prepared to explain these in detail.

8.Show Proof of Business History: Lenders want to see a track record of successful business operations. Be prepared to provide evidence of your business's history and success.

9. Prepare For the Application Process: The loan application process can be lengthy and complicated if you do not have one or more documents ready with you. Make sure you have enough time to study the complete requirements of the loan application and provide or keep ready all the necessary information beforehand.

10. Consider Alternative Lenders: Traditional banks are not the only source of Small Business Loans. Consider alternative lenders, such as NBFCs, online lenders, credit unions, or community development financial institutions. Avoid taking a loan from an unregulated entity and/ or informal sources.

11. Be Honest and Transparent: Lenders appreciate honesty and transparency. Be upfront about any issues or challenges you and your business may be facing.

12. Understand the Terms and Conditions: Before signing any loan agreement, make sure you read and understand all the terms and conditions including all the charges, fees, etc. If you have any questions or concerns, ask the lender for clarification.The Poonawalla Fincorp Advantage

Poonawalla Fincorp prides itself on its customer-first approach, and therefore, there are several items on this list that you don't need to worry about when you're applying to Poonawalla Fincorp for a Business Loan.

For instance, the biggest advantage of Poonawalla Fincorp is that it doesn't need you to present any collateral when applying for a Business Loan. Also, all the documentation simply needs to be uploaded online as a part of a simplified loan process: there's nothing lengthy or complicated about it. You check your eligibility (aged between 24 and 65, running a business for at least 2 years with a turnover of min ₹6 Lakh), and experiment with the online Business EMI calculator to arrive at the EMI and loan tenure combination that works best for you, then apply online and upload your (basic financial and business) documents. That's it!

Poonawalla Fincorp also believes in maintaining complete transparency with its customers: all charges and penalties are mentioned online, for each of its loan products. The EMI calculator is also specific to each loan product, so you don't need to make any additional assumptions or calculations. Of course, the eligibility criteria are also clearly spelt out.

Moreover, Poonawalla Fincorp believes in the spirit of financial prudence, and so, not only do they offer the lowest interest rates in the industry, but also charge you no prepayment fees, which brings along the comfort of not pledging any personal valuable asset with the lender. This way, when your business begins earning the big bucks you envisioned, you can use your increased earnings to pay back the loan faster and reduce your overall interest burden.

Moneycontrol journalists were not involved in the creation of the article.