What Are The Business Loan Requirements?

By Author: Anujit Bhattachaarya
Total Articles: 26
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A business gives you the liberty of thought and freedom from working for a stranger’s turnover. If you have decided to work, you require financial support. You can approach banks and financial institutions for monetary aid in setting up and running your business successfully.
A Business Loan is financial support provided by distributors, banks, and financial institutions. Businesses can apply for Term and Flexi Loans for various business purposes. All organisations like privately held companies, partnership firms, sole proprietorships, startups, self-employed professionals, etc., can apply for it.
Startups
These are apt for startups and small businesses. These are unsecured financial support without collaterals and easy to apply for launch, inventory purchase, etc. If default, Loan distributors or banks can liquidate your assets and derive their amount. It is safer to apply at Reserve Bank of India regulated financial institutions. They are better venture capitalists as they do not ask for Equity ...
... dilution.
Women
The Indian Government and respective state governments have undertaken several initiatives to encourage women’s participation in the business ecosystem in recent years. Prominent schemes for women entrepreneurs include Udyogini Scheme, Cent Kalyani Scheme, Mahila Udyam Nidhi Scheme, Stree Shakti Scheme, etc.
Public sector banks and financial institutions also offer attractive Business Loans for maximum women’s participation as a business person. Check your lender’s website or meet them personally to know the benefits for women.
Requirements
Businesses need to fulfil the eligibility criteria, required documents, and terms and conditions set by the lender to apply for a Loan for business. If your business and personal profiles fit the requirements, your application moves to the approval stage.
Eligibility criteria
If you are a private limited or limited business, your company’s net annual income must be more than Rs. 15 lakh for the respective Loan amount. If you require a Loan for more than Rs. 15 lakh, your company’s net annual income should be more than Rs. 20 lakh per annum.
On the other hand, self-employed professionals need to furnish their proof of qualification and details of their self-employment work. Financial institutions assess the required skills and offer a Business Loan to individuals.
Standard eligibility
A proprietorship firm or Limited Liability Partnership must share its profit and loss statement to avail of a Loan. Lenders also check your repayment capacity before finalising the quotation. Here are the standard requirements:

Your age should be at least 21 and not more than 65 years during the application
Submit the Bank Account statement for the last two years

An audit report of the company’s or business’ balance sheet, authorised by a certified chartered accountant, is also a requirement