The expansion of the Indian financial market has brought into its ambit several financing options for dedicated funding of households and businesses. Out of these, the small business loan segment has been a typical gainer as the classification of these advances has seen detailed branching out for making financing possible for differing funding needs and as per the business’s suitability. Ever seen India has witnessed a boost it its start-up culture, the overall business loan availability has improved too for assisting the ventures with necessary financing and keep this entrepreneurship culture boosted.
Today, several business loans of small ticket sizes are available under varying types to make funding sufficiently flexible for enterprises. These loans can be useful for businesses of all scales and sizes with an edge that they are easy to avail, convenient to use, and quick to repay over a sufficiently flexible tenure. Let’s check out some of these loan types that can be the flag bearers of convenient business financing.
Line of Credit
When it comes to flexible financing options for business, not many loan options are as suitable as a line of credit. Also called as flexi loan, these types of financing options have some typical characteristics that make them stand out. Some of them include –
- – Of the total sanctioned amount, you can make multiple withdrawals from the available loan balance as and when needed to meet your business financing needs with ease.
- – The interest is charged only on the amount withdrawn and used, and not on the total loan amount sanctioned.
- – You have the option to make part-prepayments of your loan, EMI-based repayment, or even to repay via interest-only EMIs for a reduced burden and better loan management.
- – The repayment tenures are suitably flexible for easy accommodation of your small business loan.
Another innovative small business loan option, invoice discounting is available under a financing arrangement that allows you to leverage your unpaid invoice bills for raising funds. It aims to shorten the credit cycle of the business by bringing in funds quicker than their due dates.
So, in case a business has its unpaid invoices due by the end of the month but it needs funds within the first 10 days itself, it can utilise invoice financing to bring in funds immediately. Under the financing arrangement, the lender provides immediate financing to the business against a nominal charge, and acquires the rights to receive payments from business creditors by the due date.
Collateral-free Business Loans
These are business loan options known particularly for the absence of collateral involvement under the financing arrangement. A borrowing business only needs to fulfil all the eligibility requirements laid down by the financial institution to avail funding. These advances attract low business loan rates as well, which makes them affordable. You can choose a tenure of up to 5 years for the repayment of your collateral-free business loan with ease and select an EMI as per your affordability for easy repayment of the advance.
Depending on your financing need, you can choose from among these loan options and many other available in the financial market to fulfil your business funding needs conveniently. Make sure to check the terms of your preferred loan offer with your selected lender as variations in these terms can mean impact on the overall managing convenience of your small business loan.
You may also enquire about the eligibility requirements for the selected financing option and check of your business fulfils them before sending your application to improve your chances of quick loan approval. If you have fulfilled all the criteria and applied for the loan with a reputed lender, financing comes by easily within a few minutes of application itself.