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Should You Opt For An Sme Loan?

By Author: Aishwarya Mahurkar
Total Articles: 291

SME loans have been specially designed by financial institutions to meet any finance needs of different businesses. The reason why any company must consider applying for an SME loan is to help expand their business. The aim of any company after all is to increase profits. A business can only do so by consistently expanding. There are a variety of SME loans one can choose which have been specially designed depending on the company’s requirements:


Property Term Loans


This type of loan should be applied by a company to help expand their business or for any day to day working capital requirements. Such loans have a flexible tenure from 8 years to 15 years. A company can apply for a loan up to 20 Crores. The types of business which are eligible for such a loan are self employed customers, proprietorship, partnerships, private limited company, societies and trusts. Financial institutions also require the loan applicant to provide fixed collateral. The collateral must be immovable property such as commercial property, mix of commercial and residential property, institutional property, industrial property, etc.


Plant and Machinery Loans


This type of loan is offered to business to help them purchase any plant and machinery. This type of a loan offers up to 10 Crore to a business applicant. The tenure for such a loan is relatively shorter and is for a period of 6 years. The security required for this loan will be the machinery which has been purchased. If any default takes place in the repayment process, the financial institution would have to seize the machinery and sell it to recover the loan amount. This loan is relatively easier to get and requires lesser documentation.


Medical Equipment Loans


This SME loan has been specifically designed for medical businesses. The process of application for such a loan is relatively simple, requires lesser documentation and has flexible tenures. The financial institutions require the machinery purchased to be kept as security until the loan has been paid in full. Finance required for the purchase of any medical machinery can be obtained by applying for SME loan .


Business Loan


This is the only SME loan which is unsecured in nature. Such a loan can be applied for by any business to meet their financial needs. A business can apply for a loan of up to 35 lakhs for a maximum tenure of 5 years. Not only is the process of obtaining this loan easy, but it also requires lesser documentation.

These are the various SME loans available to apply for. If as a business you have any financial requirements you can apply for any of these loans to help improve and expand your business.

Author Bio :

The author is a seasoned writer on finance topics and she articulates aspects that are important to people availing the SME loans facility. She writes about a variety of topics covering the home loan documents, rates & applying for SME loan that help to make the best decision.

Total Views: 62Word Count: 493See All articles From Author

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