What Are The Criteria For Getting A Small Business Loan Online?
Getting a small business loan online takes the pain out of submitting all the paperwork to a lender and waiting impatiently to know the decision. An online business loan is both convenient and hassle-free, and here are the business loan criteria that are generally accepted.
The world of banking and finance is changing, and as it evolves there are now many opportunities for new businesses and start-ups to take business loans for growth and expansion. As such, the requirements for sanctioning and approving loans have been altered, and there are new and easier ways to apply for a small business loan online. With this dramatic change in financial lending, start-ups can now opt for business loan to fund their everyday functions and gear up to expand. We list the business loan criteria that you need to be aware of as you file your application online.
Also Read: Advantages of Getting A Business Loan
Generally, a small business loan is sanctioned to any one of the following:
- Limited Company
- Private Limited Company
- Partnership firm
- Proprietorship firm
- Self employed professionals
- Self employed non professionals
The customer profile that may be considered for a small business loan has expanded to all those who may need loan for business and include the following:
- Self employed professional including doctors, chartered accountants, company secretaries, architects and any other professionals who are practising with a proof of qualification.
- Self employed professionals such as traders and manufacturers
- Entities such as closely held companies, partnership firms, private limited companies and limited liability partnerships
- Any other profile may also be considered after closely studying the constitution of the business
As with any application, the following documents are required, irrespective of whether the business loan is for new business or for an existing business:
- Application Form: This is available online and should be filled in carefully and honestly.
- Photograph of the applicant: In case there is more than 1 applicant, a photograph of each applicant is required.
- Income Details: Take care to ensure that all the documents needed by your chosen lender are provided or attached in your online application. The usual documents required include the following:
- IT returns with all annexure for the last 2 years
- Balance Sheet with all annexures for the last 2 years
- Profit & Loss statement with all the annexures for the last 2 years
- Form 16A
- Business bank statement for the last 3 months
- A business proof such as certificate of practice
- In case there is a co-applicant, the KYC (Know your customer) documents of the co-applicant will also be needed.
- Business vintage for 5 years: Loans are usually offered for companies that have been in business for at least 5 years though this may vary from lender to lender.
- Documents like Sole Proprietor Declaration Or Certified Copy of Partnership Deed, Certified copy of Memorandum & Articles of Association (certified by Director) and Board Resolution.
Depending on your chosen lender for the business loan, you may also need to abide by other criteria such as age, minimum turnover of your business, amount of profit recorded for a certain number of years as well as a certain minimum annual income.
Keeping all the criteria in mind and being organised about all the documents needed will go a long way in getting your application for a business loan sanctioned. Usually the requirements for a small business loan are quite basic. The next step to keep in mind is to choose a lender that fits your requirements. At Bajaj Finserv, small business loan applicants have the advantage of low interest rates and no collateral.