Business Loans In India

Indian banks provide loans for business to expand

, establish and renovation. These loans are known as commercial loans or business loans In India. These loans are opt by the firms, corporations, self employed professional or individual to meet their business requirements like paying off debts, purchase of warehouse, purchase of machinery, purchase of fixed assets, increasing working capital and many more. The person can avail the business loan in India for the minimum amount of Rs.50000 and maximum amount up to Rs.20lacs and provide for the tenure of 1 to 5 years.

Business loan in India is segregated in two types secured and unsecured business finance. Secured business loan in India is that finance in which the businessman has to provide security or collateral for availing this finance. The customer can pledge anything, whether it is a business asset or property. The bank provides this loan for the longer tenure and at low interest rate. This is so; the risk of lending is low.

Whereas, unsecured business loan in India is the finance in which the customer does not have to provide any security or collateral to the lender for availing this finance. Thus, bank provides this finance at high interest rate with shorter tenure. The bank charge 18-30% interest rate on unsecured business loan in India.

The person can also avail business loan on the base of its term, i.e. for short term business loan, intermediate term business loan and long term business loan. Short term business loan in India is avail by the customer to meet the necessities of the working capital of their business. This loan is avail to meet short term requirements of the business and has to repay it back within 1 year.

Intermediate terms business loan in India is avail to purchase machineries or to increase inventory or working capital or want to initiate new business.

Long term business loan in India is avail to meet long term requirements of the business. The customer uses this loan for purchase of the building or fixed assets or to start a new business. The customer can repay the loan amount within 3-5 years.

Even the business loan in India is categorized according to the loan provider also; i.e. trade loan and professional loan. Professional loan is provided to doctor, engineer architect and many more. The business finance amount depends on the customers repaying ability.

Trade loan is avail by the traders and the businessperson for meeting their business requirements. The customer can repay the loan amount in 5 years.

by: Dialabank

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