How Do You Get a Business Loan In India Without Security?
Getting a business loan in India is difficult for small businesses as the traditional lenders ask or collaterals. We have a look at the best options the small businesses have to get a business loan in India.
Small businesses constitute the bulk of India’s GDP and jobs. However, they face a huge gap when it comes to the availability of funds which they need to grow their business. While there are challenges like the slow processing of loans by the traditional lenders which often takes weeks or even months to get a business loan in India. The biggest hurdle in their path which stops the small businesses from getting a business loan in India is the fact that the traditional lenders ask for security in the form of collaterals like home or office properties and as most of the small businesses operate on a leased or rented premise they are unable to get access to business loan in India.
Understanding Unsecured Business Loans:
Unsecured business loans are loans that don’t require collateral, such as property or assets, to secure the loan amount. These loans are typically based on the creditworthiness and financial health of the business.
Tips to Get an Unsecured Business Loan in India:
- Build a Strong Credit History:
- Maintain a good credit score by paying bills and loans on time.
- Regularly check your credit report to ensure accuracy.
- Establish a Solid Business Plan:
- Create a comprehensive business plan that outlines your business model, revenue streams, and future projections.
- Highlight how the loan will be utilized to enhance the business.
- Demonstrate Financial Stability:
- Lenders often look for businesses with a stable financial history.
- Provide audited financial statements, including income statements, balance sheets, and cash flow statements.
- Explore Government Schemes:
- The Government of India offers various schemes to support small and medium enterprises (SMEs).
- Research and apply for schemes that align with your business needs.
- Choose the Right Lender:
- Different lenders have varied criteria for unsecured loans. Explore banks, non-banking financial companies (NBFCs), and online lenders.
- Compare interest rates, terms, and eligibility criteria before applying.
- Alternative Lending Platforms:
- Explore online lending platforms that cater specifically to small businesses.
- Some fintech companies provide unsecured business loans with a quick and streamlined application process.
- Strong Revenue Streams:
- Lenders may prioritize businesses with consistent and healthy revenue streams.
- Showcase your business’s ability to generate revenue and repay the loan.
- Professional Advice:
- Seek guidance from financial advisors or consultants who can help you understand the best options available and guide you through the application process.
- Network with Industry Peers:
- Attend industry events and network with other businesses to gather insights and recommendations on lenders who offer unsecured business loans.
- Be Transparent and Responsive:
- Clearly communicate your business goals, financial situation, and how you plan to use the loan.
- Be responsive to queries from lenders to build trust.
While, it is a challenge for the small businesses to get a business loan in India, there are the top digital lenders who are helping the small businesses with access to a business loan in India without any collaterals or security. One such leading digital lender is Indifi which is helping thousands of small businesses to get access to a business loan in India.
Indifi enables the small businesses to apply for a business loan in India with a quick online application which can even be done using the Indifi app by filling some basic KYC and business details, as this business loan is without collaterals, small businesses do not need to provide any security or other details.
Further, Indifi fetches the digital trace of transactions from your business partners like the card swipe machine for a retail shop, food delivery apps for a restaurant, e-commerce platforms for the e-commerce sellers and travel aggregators for the travel agents and hotels and so on for the other businesses. These digital traces of transactions are analysed by advanced machine learning algorithms by analysing the partner data and using the public data made available by the small business.
The small business then gets a decision based on the credit evaluation of the business loan in India and they can check the decision online using the Indifi App itself, without the need of having to visit any branch location as is the case with the traditional lenders. It is only after the decision that the small businesses are needed to sign or e-sign the agreement and provide the basic mandated documents online. One can use the Indifi App to complete all formalities for the business loan in India.
Indifi is today helping more than 10,000 small businesses to get access to a business loan in India without any need to provide security or collaterals like home or office properties. The business loans applied using the Indifi App are completely unsecured and help small business to grow. Another fact that makes these business loans in India a boon for the small businesses is the fact that these loans can be availed in really quick time, a small business can get a decision for a business loan in India using the Indifi app well within 24 hours. The business loans offered by Indifi are completely flexible and the small businesses do not have to worry about paying the same amount of instalments even when they are not earning as much as they want to. As these loans are connected to the business transactions the small businesses can pay more when they earn better and pay a lesser amount when they earn less. The Indifi App gives complete visibility on transactions and loan management.
Thus, if you are a small business and need funds to grow, look for business loans without collaterals with the top digital lenders in India like Indifi who offer business loan in India based on your business transactions and provide customized loans to every business type. These loans can be simply availed using the Indifi app and small businesses can get access to unsecured business loans from INR 50 Thousand to INR 50 Lacs which not only helps them to manage their working capital but also helps them to grow with instant access to funds as and when they need it without having to worry about collaterals or securities.
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