IB-EMI-9-1-2017-13_All you need to know about business loans

All you need to know about business loans

A business loan is a loan without security that gives your enterprise access to credit, which can be paid back over an agreed period of time along with interest. Small or new enterprises that are just getting starting on their journey and still finding their feet typically find it difficult to get a business loan as they may not have strong financials. Every new business is looked at with a magnifying glass by banks and financial institutions, as they believe new businesses have a higher chance of failing. However, there are many lenders like Bajaj Finserv who strive to make this process simpler and more straightforward. Here is how you too can get one to expand your business.

When does your business need a small business loan?

A small business is always looking for additional cash, whether it is to fund growth by entering new markets, get a bigger space for employees or manufacturing, get a better deal on raw materials by getting the cash advance discount, or for increasing the SKUs in their inventory. The right amount of funds at the right time also helps better the cash flow and a cash-strong business can provide longer credit to buyers, which can help in funnelling growth and expansion. Whatever your reasons for needing a business loan, getting one can certainly help you in advancing your business.

How to apply for a business loan?

These days, applying for a business loan is easy and can be done online without waiting in long or complicated queues. If you choose Bajaj Finserv as your lender for the business loan, simply log on to www.bajajfinserv.in, select the ‘Business Loans’ tab under ‘Our Products’ and select the ‘Apply Now’ button. This will guide you to an online application form. Fill it out, and you’re done. Once the lender checks your application form and the needed documents, you will get approval soon—sometimes even within minutes!

Documents required for a business loan

  • Application form: This is available online, and is easy to fill and submit.
  • Photograph of the applicant and co-applicant (if any)
  • Details of Income: This includes the following –
    • Income Tax returns for the last 2 financial years
    • Business Balance Sheet for the last 2 years with annexure
    • Business Profit & Loss account for the last 2 years with annexure
    • Form 16A for the last 2 years
  • Business bank account statement for the last 3 months
  • KYC [Know Your Customer] documents of the applicant and the co-applicant (if any). KYC may include scan copies of ID proof, address proof and PAN card.
  • Details of business vintage for 5 years
  • In case of a practicing professional, a certificate of practice is also required.

Small business loan repayment options

As a borrower, you can sometimes choose your repayment options based on your convenience. At Bajaj Finserv, the loan amount for a business loan goes up to Rs 30 lakh, and the repayment options are based on the requirements of the business with repayment tenures running from 12 months to 48 months.

Advantages of getting a business loan from Bajaj Finserv

The unique advantages Bajaj Finserv provides with their business loans are:

           

  1. Flexi Loans that give you all the convenience you need

Bajaj Finserv offers a Flexi Loan option where you have the option of repaying and withdrawing money from your loan account as per your business needs. Further, interest is only charged on the portion of the loan that is withdrawn rather than on the whole amount to save you from paying more interest needlessly. With easy online access, you can get the funds transferred into the business account without any complicated procedures or delay. When it comes to prepayment or part payment of your loan, you can do this easily with flexi loans as well without worrying about fees or charges being added to your account.

  1. No collateral to make the application process stress-free

Collateral is the way by which the lender secures his loan (mostly by way of property or assets), and most lenders seize the collateral when the borrower defaults on the repayment. Bajaj Finserv doesn’t require you to furnish any collateral, giving your small business a chance to grow and succeed.

  1. No guarantees required to give your business a chance to grow

A guarantor is a person who becomes liable in case the debt obligation is not met by the borrower. At Bajaj Finserv, a business loan can easily be taken without furnishing any guarantee.

With the highest unsecured loan amount by any loan provider in India in this segment, Bajaj Finserv’s business loan may well be the opportunity your business needs to grow and flourish.

Apply for Business Loan

IB-EMI-9-1-2017-12_How to apply for business loan

How to get a business loan

With easy loans for limited or public

 

Small and medium size businesses when challenged with an unexpected financial obstacle, may not be completely prepared to provide a bank or financial institution with the additional security or collateral, in order to acquire a business loan. In such cases, a small business loan from Bajaj Finserv with no security and easy repayment options is possibly the best option forward. Following a simple procedure online, you can apply for a small business loan that will go a long way to re-energise your business. Let’s take a closer look at the process.

Eligibility

The small business loans are devised for the following types of entities

  • Limited Companies
  • Private Limited Companies
  • Partnership firms
  • Proprietorship firms
  • Chartered Accountants
  • Self Employed Professionals
  • Self Employed Non-Professionals
  • Other entities based on profile

 

Documentation requirement

 

You can Apply for small business loan or for a loan for business start up with the following documents

  • Application form: Available online. Easy to fill and submit
  • Photograph of the applicant and co-applicant (if any)
  • Details of Income: Include the following –
    • Income Tax returns for the last 2 financial years
    • Business Balance Sheet for the last 2 years with annexure
    • Business Profit & Loss account for the last 2 years with annexure
    • Form 16A for the last 2 years
  • Business bank account statement for the last 3 months
  • KYC [Know Your Customer] documents of the applicant and the co-applicant (if any). KYC includes scan copies of ID proof, address proof and PAN card
  • Details of business vintage of 5 years
  • In case of a practicing professional, a certificate of practice

All you need to do to apply for business loans is the following:

  1. Log onto our website at bajajfinserv.in
  2. Select the ‘business loans’ tab under ‘Our Products’
  3. Click on the ‘Apply Now’ button highlighted in blue
  4. This will lead you to the online application form

Fill the online application and hit ‘Submit’ and let us guide you through the easy process and help you avail our collateral and guarantor free business loans.  

At Bajaj Finserv we understand the difference immediate access to additional cash can make to a small business. With this in mind our small business loan application requirements are small yet precise enabling the business owner to concentrate on the business while we provide quick cash at competitive interest rated with flexi-options that enable the business to prepay the loan amount without any additional charges. With our EMI’s ranging from 12 months to 48 months, we provide you time to comfortably repay the loan in easy EMI payments.   

Apply for Business Loan

IB-EMI-9-1-2017-11_How to meet your goals with mutual funds

How to meet your goals with mutual funds?

Mutual funds are linked to financial markets, and allow the investor to invest across asset classes from equity and debt to gold. With various investment options that range from high risk and insecure to low risk and secure alongside short term and long term investment options, finding the right mutual fund to meet financial planning goals is easy and can be very rewarding too. Here’s what an investor needs to know to achieve his/her financial goals through a mutual fund investment.  

 

Understand the investment potential

When you, as an investor, step into financial planning whether for the short or long term, you need to understand your current financial position. This includes your current income, monthly expenses, current investment liabilities, loans and EMI payments as well as savings and investments. This will help you understand the money you have to invest in mutual funds as well as your time horizon to fulfil your personal financial goals.

 

Risk appetite

When you have a clear understanding of your investment potential, it will also become clear how much risk you are willing to undertake. Your investment potential is determined by the income level, age, liquidity and the time you have available to meet your financial goals. Based on this, you can determine the asset class that is best suited for your mutual fund investment needs. The age of 30 or below is ideal for a high-risk appetite as time and potential earnings help investors absorb losses. In contrast, when the investor gets closer to retirement age, he or she will want to invest in mutual fund with low risk and yet maximise the returns.           

 

Asset allocation

Investment in mutual funds can be personalised as per your financial goals. Asset allocation lets investors like you appropriate the investable surplus across different asset classes depending on long term and short term goals. The rule of thumb is that higher risk leads to greater potential reward. Invest in mutual funds based on equity, which can be more volatile in the short term, when looking at a long-term investment window. A 3-year or longer window will help the high-risk equity mutual fund recover from any market volatility. For short-term investment of less than 3 years, invest in mutual funds that are debt backed as the returns are secured, although the return may be lower than equity backed mutual funds.

 

With myriad options and a solution for most investment requirements, investors can use mutual funds to meet financial planning goals with ease. Investing in different asset classes can further reduce your risk. Ideally, investing in three or more diversified funds will provide your investment the required spread to meet your financial goals through mutual fund investment. Whereas you can invest in mutual funds via a variety of banks and non-banking financial institutions, try Bajaj Finserv. With the right advice based on your specific requirements, Bajaj Finserv’s mutual funds also come with high security standings that ensure the safety of your investment in the long run. To find out more, click here:

Market Crash! Should you invest in Mutual Funds or Fixed Deposits?

Market Crash! Should you invest in Mutual Funds or Fixed Deposits?

While many investors get excited when the market crashes, looking to close a better deal on mutual funds that have become cheaper, there is need to be careful when it comes to deciding on the next step.

Let’s Understand What Happens When the Market Crashes:

Mutual Funds: When the market crashes, the prices of equity stocks fall. With this fall, the NAV [Net Asset Value] of mutual funds also fall. Depending on which sectors are most hit in the market crash, the mutual funds invested in those sectors will see a higher decline in their NAV.

Fixed Deposits: There is no change in the interest or tenure of the fixed deposit investment as those are locked with the bank and have no association with the fluctuating equity markets.

As a new investor what you need to know before making an investment decision after a market crash:

Mutual Funds

The best way to understand how well a mutual fund is performing is to analyse its past record and compare the same with its peers. Once the analysis is complete, check to see whether the expense ratio is low and ensure there are no exit loads. Keep in mind that mutual funds that lose the most value are not destined to be the greatest rebounders as the market recovers. Also study the mutual funds that may not have taken the most beating in a market crash, as these mutual funds may be able to absorb future market shocks with ease while growing well in between market crashes.

If you have already invested in mutual funds and are looking to increase your exposure in the market by investing more in the same mutual funds, you need to consider the past NAV of the selected mutual fund. Is the present average NAV lower than the 3-year average? If the present NAV is lower than the 3-year average it could be argued that the fund is undervalued. Next, it is prudent to check whether the fall in NAV is only because of the market crash or whether the mutual fund has been consistently falling. In case of a consistently falling NAV, the investment may not be the best bet. While all these are merely security measures, there is no sure shot way to ensure that the NAV of the chosen mutual fund will increase after a market crash.

The best bet against such market inconsistencies, while securing a safe return with low risks for your investments would be an SIP (Systematic Investment Plan). Choosing an SIP gives you the advantage of investing a small amount on a weekly or monthly basis. This allows you to buy more units as the NAV of the mutual fund decreases. This will yield higher returns when the NAV increases. When the NAV is at a high, the investor will be able to purchase fewer units, but in the long run the returns will compensate for the purchase loss.

Fixed Deposit

Investing in a fixed deposit is a safe option even after a market crash as there is no change in the returns offered, and at the same time the investment is secure. This is mainly because of the fact that fixed deposits and their interest rates are not affected by the day-to-day volatility of the market, its stocks and shares. However, the investor may miss the opportunity to make a higher return by being part of the erratic market.

Additional Read : How is fixed Deposit better than any other Investment?

To conclude, for a low risk investor fixed deposits may be the right investment after a market crash, and for an investor with a greater risk appetite, mutual funds may yield higher returns after a market crash. With many investment options spanning fixed deposit and mutual fund investments at competitive interest rates and easy documentation and set-up processes, Bajaj Finserv may be an option worth looking at. To know more about these click here:

Invest in FD @8.05% High Interest Rate

When it comes to mutual funds, here’s why SIPs are so popular

When it comes to planning a secure future for yourself and your family, you not only have to think wisely, but also be smart. Taking advantage of the right investment opportunity at the right time is difficult, but with SIPs, investors who are just starting to get the ball rolling can get good returns with minimal strain on monthly expenditure. Like Aarav and Suman Dubey, a couple residing in Mumbai, you too can invest wisely and smartly in SIPs and watch your hard-earned money earn exciting returns.

Aarav (32) and Suman (28) Dubey, married for two years, have decided to go the family way. Expecting good news soon, the couple are keeping their fingers crossed. However, a lurking anxiety is troubling their minds. New responsibilities and a lifetime of commitments would lead to added expenses. So, it is imperative that they make careful and wise financial investments for a secure future.  Aarav and Suman did exactly that. They chose to invest in a systematic investment plan, i.e., a SIP investment in mutual funds.

What are SIP investments?

Aarav found that investors like them had the convenient option to invest in mutual funds through small amounts periodically, be it weekly, monthly or quarterly, based on their convenience. Rather than a heavy one-time investment, Aarav believed that an auto debit every month from his account made more financial sense. Since their investment depended on their risk appetite, which was moderate, he thought that a SIP investment would help them achieve their future financial goals with relative ease.

When Suman expressed doubts about this investment option, Aarav explained that mutual funds are investment programmes funded by shareholders with similar interests and objectives as investors. The funds are strictly regulated and registered with SEBI, and would help them strike a balance between capital growth and tax savings.

Aarav found that Bajaj Finserv offered the best mutual funds interest rates and that these funds were professionally managed by adept market specialists, ensuring better returns and lower risk. As investors, Aarav and Suman would be able to diversify their portfolio with SIPs. One of the most important reasons why they also chose to invest in mutual funds was transparency. Aarav and Suman would be able to keep a track of their investment with easy online access where valuable information on the current value of their investment would be visible. Easy access to the detailed portfolio disclosure of their investments would also help the couple understand the investment and reap the benefits.

Advantages of SIP

Years into their SIP investment, Aarav and Suman were basking in its advantages. Not only were they reaping benefits, but also recommending SIP investment in mutual funds to friends and family. Here’s what Aarav and Suman had to say:

  • SIP is a smart investment option, which gave them a disciplined approach to investment with the flexibility to invest small amounts periodically.
  • SIP is an investment across market phases over a long term. Hence, there is a minimal risk of market timing, which is otherwise a major concern for novice investors.
  • There is ample scope for investment, irrespective of whether the market is up or down. SIPs help in steadying the mutual fund investment where more securities can be bought in market lows and vice versa. This helped the couple average out the cost of investment, over long term with superior returns and fewer shocks.
  • Aarav and Suman felt no opportunity loss arising from lack of funds. Instead, the money kept flowing into the market periodically.
  • The rupee cost averaging in SIPs helped lower the average per unit cost. This helped reducing the unpredictability and risks.
  • Finally, the couple also experience the power of power of compounding, where their small periodic investments created a big corpus over time.

 

Like Aarav and Suman, you too can experience the benfits of SIP investments with Bajaj Finserv mutual funds. To know more,

click here:

IB-EMI-9-1-2017-08_Questions to Ask Before Choosing A Mutual Fund

5 points to note before investing in mutual funds

Mutual funds can not only give you exciting returns, but also help you save on taxes. However before you invest in them, be sure to do your research. This will help you be better informed and invest more wisely. Factors such as your risk appetite, the type of mutual funds you choose to invest in, the investment lock-in period or minimum investment period, returns over successive years, etc., are just some examples. Here are the questions you should ask before you choose a mutual fund.

  1. What is your aim?

The first question to ask yourself is what is your aim of investing in a mutual fund? Are you investing to maximize profit and make money? Are you investing to save the amount you already have and save on taxes? Or are you looking at having a steady source of income? Once you answer these questions, you know your primary goal, which helps you in selecting the type of mutual funds you can investment in, be it a high-risk long-term investment or a short-term low risk investment or any combination thereof. Knowing your risk appetite and the time period for which you can invest also helps in choosing your mutual funds.

  1. Have the returns been uniform throughout?

Once you have made the decision as to what type of funds you are investing in, you need to dig deep into the mutual fund portfolio. Find out past turnover profit and loss and see if the mutual fund has been profitable year after year or has there been a huge profit one year and a major loss the next. Just looking at the current or previous year’s record is not sufficient. See the mutual funds’ performance spread out over the last 10 years. The uniformity of the invested returns is a good way for you to judge where you want to invest your money in that particular mutual fund. By digging deeper into the portfolio, you will also know what type of securities you are investing in.

  1. What is your expenditure in proportion to the returns?

The next question you need to ask is how have the profit graphs been over the years. It is not necessary that the more you invest, the more you make. You could invest a large amount and get less profit as compared to investing a small amount and getting a big profit. To understand how this works you need to study graphs of the mutual funds you wish to invest in and find their standing. The aim should be to invest the least amount and get maximum profit. Another thing to do here is to understand the expense ratio. This is the amount you spend towards the management of your mutual fund, which is deducted from your investment. A lower expense ratio is usually a better bet when it comes to mutual funds.

  1. Is your money in the right hands?

While you will also look at which securities your money will be invested in, what is most important is knowing how much you can trust the fund managers. Study the record of your fund managers and their portfolios in the past. Tracking their performance over just one or two years won’t help in this case, since there may or may not be any uniformity in the investment returns in such a short period of time. Portfolio managers with at least 15 years of experience are the best ones to trust and if you see profitability in their record, then those are the right people for you. These managers would know about the securities your mutual fund is investing in very well and thus would invest to maximise your returns. So choose a mutual fund based on who is on the driver’s seat and base your decision on their experience and track record.

  1. Are there any inside costs that you should know about?

After checking the mutual fund rates, you also need to check whether there are any hidden or inside charges, fees or expenses. Thus reading the mutual fund prospectus is essential as you might discover extra charges that you were not aware of earlier which you have to pay at different times once you invest.

These are the 5 main questions that will help you choosing the right mutual funds. Like many investors, you will need to give yourself some time even equipped with the answers to the questions above, and start with a small investment, which will help you learn as you go. The most important step is choosing your mutual fund investment with the right institution. One of your options is investing with Bajaj Finserv, which ensures that your investment is professionally managed, offers transparency, low transaction costs and some of the best interest rates. To know more click here:

IB-EMI-9-1-2017-07_7 Reasons Why Fixed Deposits Are Better Than Savings Accounts

7 reasons why Fixed Deposits are better than a savings account

A savings account offers you no limit to the amount you can deposit. There is no fixed tenor, there is no fixed rate of interest, there is no benefit of depositing a larger sum, there is no TDS on interest earned, there are no lock-in periods and no real tax savings on offer. A fixed deposit, on the other hand, may or may not have an upper limit for the deposit based on the lender. It also has a fixed tenor, a fixed rate of interest, which varies according to the amount deposited, age of the depositor and duration, have lock-in periods, have their interest subject to TDS but also offer tax saving FD accounts, and may be used to avail loans.

The advantages of a fixed deposit vs. savings account can be summarized in the following way:

  1. An FD gets you into a habit of saving

Having a fixed deposit account means not being able to withdraw money until you reach the account maturity. While this may initially prove to be difficult, you will soon get used to it, and develop a habit of saving. In a savings account you can withdraw money whenever you want and this fosters indiscipline when it comes to savings. Of course, you can break an FD in the time of emergency, but at the risk of getting lower returns.

  1. An FD ensures that you earn a good return

As compared to a savings account, you get to earn interest in a fixed deposit account, which is higher than what you earn in a savings account. So not only do you save in a fixed deposit account, you also make money.

  1. An FD assures returns

If you invest in a fixed deposit you are sure to get returns on your funds, instead of letting them lie idle in a savings account. Until your maturity period expires, you are bound to get a fixed amount of interest on your investment in a fixed deposit. In a savings account, though you get interest, it is negligible as compared to a fixed deposit.

  1. An FD allows you to easily avail loans

You can avail loans up to 80-90% of the value of money deposited in your fixed deposit account. In a savings account, this would not be an option, as you would have to apply for a loan separately and cannot avail loans against your savings account.

  1. An FD allows you an investment tenor of your choice

Depending on your requirements, you can choose a tenor from 12 months to 60 months based on your unique needs and wishes. In a savings account you don’t have to wait until maturity to withdraw your money, but neither do you get to earn in the form of interest.

  1. An FD doesn’t limit you in terms of number of accounts

If your purpose of investing in a fixed deposit account is saving for something big, and there is more than one thing you need to save for, you are free to make more than one fixed deposit account. Saving for something big can never be done in a savings account, since the ability to withdraw money from it gives you an urge to spend and doesn’t give you a substantial interest either.

  1. An FD allows you to have a fall back or fail safe

The benefits of having a fixed deposit account are many, but the most important one is that it gives you a fall back, which comes in handy at the time of a cash crunch or for a future investment. A savings account in contrast, is used on a daily basis and will not offer you a fail-safe in times of need.

Additional Read : Pros and Cons of Fixed Deposit

As an investor, you have a lot to gain from investing in a fixed deposit, as the points above clearly illustrate. When it comes to choosing your fixed deposit account, find a lender than you have easy access to, which has stable FDs with high security ratings and offers you a good interest. Try Bajaj Finserv, which has over 200 locations across India, has AAA/Stable Rating by CRISIL and MAAA (Stable) Rating by ICRA, allows you to choose an investment tenor based on your needs and offers both cumulative and non-cumulative FDs.

Invest in FD @8.05% High Interest Rate

IB-EMI-9-1-2017-06_Should You Break That Fixed Deposit

Is it ever a good idea to break an FD?

If you are thinking of breaking your fixed deposit, you first need to ask yourself if it is absolutely necessary or if you are simply being swept up by the potential of earning more.

Let us look at certain factors that affect the amount of money you have invested and the amount of money you will make from the fixed deposit.

When is it prudent to break your Fixed Deposit?

The first thing to do is to study the factors that are making you consider breaking your fixed deposit. Think logically and practically about these factors and then make a reasonable choice. If you are facing an emergency, like dealing with taking care of a family member who has had an accident, an urgent business requirement or facing a cash crunch that cannot be fulfilled in any other way, then breaking your fixed deposit is acceptable.

If you are considering breaking your fixed deposit because you aim to get more interest as per the current fixed deposit interest rate in the hope of getting more money at the time of maturity, you are mistaken. On breaking a fixed deposit, you do not get the interest stated in your deposit certificate since you are making a premature withdrawal. Also, as a penalty, you will be charged an interest of 0.5% to 1% on the amount you were supposed to receive. Thus, what you end up with us even less than the current fixed deposit interest rate.

Why is it wise to only close a fixed deposit account on maturity?

Premature withdrawal of fixed deposit would mean getting less amount of interest on your deposited account. For example, if you have invested in a fixed deposit for four years at a fixed deposit interest rate of 9% and you have to prematurely withdraw the amount in one year instead of four, you will receive the interest applicable for a year, which would be, say 6.5%. On top of this, the penalty for premature withdrawal of fixed deposit would be 0.5-1% (differing from lender to lender), so you will receive the interest at 5.5% on your deposited amount, instead of the 9% interest rate that you were supposed to receive at the maturity of the account. Investing the amount received on the premature withdrawal of fixed deposit into another fixed deposit with a higher interest rate will not make you any more than what you were to receive at the end of the first four years, if you had not withdrawn your deposit. Thus, it wise to only close a fixed deposit account on maturity.

The procedure for closing a fixed deposit account on maturity is very simple. All you need is your deposit certificate or receipt as proof or use its photocopies. If you are unable to produce this at the time of withdrawal, you can even write a letter to the manager.

Additional Read : All you need to know about Fixed Deposit

When you choose a fixed deposit, make sure that your investment is secure by checking its rating with your chosen lender and see that it gives you a good rate of interest. Investing in fixed deposits with Bajaj Finserv has various benefits like highest security ratings, an additional 0.25% interest rate for senior citizens, online access to your account, and no tax deduction at source on interest payment up to Rs. 5,000 per annum.

Invest in FD @8.05% High Interest Rate

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