Everyone has the idea to start their own business, but the major hurdle is Finance, as the funds are more critical. For any business, there will be short-term or long-term goals and purely depend on the investment. It is more hectic for entrepreneurs to find ways and solutions to raise the capital amount. The best solution to fix this solution is the business loan, which you can get from a bank, non-financial institutions, crowdfunding, or venture capitalists and angel investors. The eligibility criteria may differ for these institutions, as some have lenient and some have stringent requirements.
The basic criteria are that
- The age limit for getting these loans is a minimum of 21 years and a maximum of 65 years.
- The business should be established and should run for at least 6 months.
- A business that you are running should not be under the category of exclusion or blacklist from the financing institution.
- It should not be a charitable trust or NGO.
First, you need to find out how much money you need to run the business and create a business plan. You should produce all the required documents to complete the evaluation process and to get the loan sanction quickly. While choosing the business loan, the interest rate is most important, hence pick the institution which offers the lower interest rate in each monthly installment. Pick up the loan with the tenure of having 5 years and above and supports the variable payment option. Nowadays you get these loans online and they assure to disburse the amount quickly.
The document required for getting a loan is
- Last 6 months bank statement.
- Business registration proof along with certificates, trade license, GST filing, and TIN records.
- Individual owners and companies PAN card.
- Financial details like the investment accounts, addresses, and credit card accounts. Get all these documents perfectly reviewed and audited.
- Provide the past returns copies and the insurance information of your organization.
- Produce the complete details of account receivables and payables.
Before proceeding, it is advisable to check with the accountants and have a good CIBIL score. Maintain a good relationship with the loan lenders and follow all their instructions. Verify the balance sheet to learn about the profit earnings and loss statement to decide wisely.
To run and close the loan soon, you need to pay the repayment time and have the proper bookkeeping, forecasting, and planning on the payment terms. Monitor your business’s financial health at regular intervals and keep it manageable and organized.