Corporate Loan Options for Your Next Level Business in 2021
Any business, big or small, demands timely funding for growth and survival. As a business owner, you may have often found yourself looking for a corporate loan to meet your business requirements. However, these requirements vary from business to business and include everything from restocking inventories to purchasing assets, office space, paying employee salaries, leasing a factory, and even arranging for working capital.
Nevertheless, there are different types of business funding options available in India that will fulfil your demands. However, as a competent business owner, it is your call to select the one that is the best fit for your business’s requirement. Read on to know more.
Next Level Corporate Loan Options That You Can Consider
• Professional Loans
The professional loan is a type of business loan that is only applicable to self-employed professionals, such as Chartered Accountants (CA), doctors, lawyers, etc. This loan prototype is similar to every other business loan. Depending on your credit history and business profile, the financial institution will approve this loan for you.
However, if your loan amount exceeds a certain threshold, you will need to provide mortgage or collateral in order to be approved. However, Life Insurance Policies, National Savings Certificates, Term Deposits, and Government Bonds, among other things, can be used as collateral to get the loans approved. Always rely on the best lending institution to avail of this loan for starting or expanding your venture.
• Term Loans
It is one of the traditional business funding options available in India for business owners. Term loans are available in both secured and unsecured forms. It also operates in the same way as other loans, requiring validation of several factors, including the business and personal credit histories, in order to be approved.
This loan can be used by an entrepreneur to fund a specific business purpose. However, they need to disclose the motive of such funding requirement to the lender. In general, the repayment tenure of a term loan is fixed. In the case of unsecured term loans, this duration usually extends from 1 to 5 years, and for secured business loans, this tenure ranges up to 15 years.
• Business Line of Credit Scale
This loan scheme works similarly to a credit card and eventually provides you with a lot of flexibility. The best part about a business line of credit is that a business owner can borrow funds at any time, depending on the requirements, without having to go through lengthy approval processes.
When you apply for this fund option, you have to open an account with a pre-approved upper limit. Once the account is active, you can freely borrow capital from anywhere, at any time. The interest charged will also be calculated based on the used amount rather than the cumulative cap.
The last words
Whether corporate loan you apply for, make sure it fulfils your business requirements without any hassle. A business or venture frequently demands funds for long-drawn necessities. So, once you understand your business needs, it will be simple to choose the most appropriate funding option to help you succeed in your dream venture.
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