Business Loan | Aroon Fintech

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Proprietorship

Partnership

Company

Business Loan Details

The business loan interest rate is determined by a number of factors, including the borrower's financial profile, the purpose of the loan, collateral, the credit score or credit rating, and much more.

The following factors affect the business loan evaluation process:

The financial feasibility of the business model.
The amount of competitiveness in the industry.
At the industrial level, the performance of the corporate entity.
Annual turnover and overall business growth or expansion.
Ratio financiers.

Banks decide the interest rates at which a loan can be issued to a borrower based on all of these indicators. The applicant's personal creditworthiness is taken into account in addition to the business's trustworthiness. Lenders typically offer commercial lending rates ranging from 7% to 21%.

Banks and finance providers have preset business loan eligibility criteria. To procure a commercial loan with the utmost ease, stick to the following eligibility criteria:

Applicants must follow the RBI's definition of Micro and Small Businesses.
The sole purpose for obtaining a business loan (working capital, business expansion, or the purchase of machinery or equipment) must be specified.
A personal guarantee is required. This will necessitate the main partner to act as a loan guarantor.
The company must have been in operation in the same domain for at least three years.
Financial papers, such as audited financial accounts, are unavoidable.
Tax audit report (last 2 years).
Bank statement of the business account (last 6 months).

The following business loan documents are mandatory to avail of a loan with utmost ease:

Form and Photographs: Duly filled business loan application form and 2 passport size photographs.
Proof of Identity: PAN card, passport, Voter ID card, MAPIN Card or driving licence.
Residence Proof: Voter ID card, ration card, utility bills, including electricity bill, telephone bill, Aadhaar card or lease agreement.
Age Proof: Voter ID card, Aadhaar card, PAN card or passport.
Financial Documents: Income Tax Returns for the last 2 years, balance sheet audited by a certified Chartered Accountant (CA), profit and loss statement (2 years), along with a statement representing the business transaction.
Proof of Income: Bank statement of business account as well as the personal account for the last two years.
Proof of Business Ownership: Documents including the declaration of a sole proprietorship, a copy of the memorandum along with the articles of association will be required.

Business Loan Documents Required

Pan Card
Aadhaar Card / Voter Card / DL
Current Residence Proof
Ownership Proof
GST Registration
Business Address Proof
Last 3 yrs. ITR With Financial
Last 1 yr. Current a/c Bank
Statement / SB a/c
Last 1 yr. GST Return 3B
Photograph