Small and Medium enterprises (SMEs) are rapidly growing in number. Over the past few years, the number of SMEs in the country has risen to an all-time high, which necessitates the need for quick and easy business loans as a majority of these SMEs suffer from a shortage of funding.
With Bangalore being the IT hub of the country, a majority of these SMEs are based out of Bangalore. Although the eligibility criteria to obtain a loan stays the same across all states, the high demand for funds in Bangalore ensures that an SME can successfully obtain funds at a more lucrative interest rate. These loans are sanctioned by the Indian government and are provided collateral free (only for MSMEs). It is extremely simple for a business to apply for this loan online as well.
Numerous financial institutions advance SME loans to Self Employed Professionals (SEP) and Self Employed Non-Professionals (SENP), as well as other entities. Sub professions within these categories include: –
SEP: Doctors (Allopathic only), Chartered Accountants, Architects and other self-employed professionals.
SENP: Manufacturers, retailers, traders fall under this category.
The eligibility criteria to obtain a business loan in Bangalore are as follows –
The applicant must be aged between 25 and 55 years.
He/She must have an ITR filed for at least 1 year
The business must have been running for a minimum period of 3 years.
In order to get instant loan for self-employed in Bangalore, the following documents are needed:
Identity Proof: A simple ID proof such as Aadhar, Passport, PAN Card, etc. along with the necessary KYC documents is needed.
Address Proof: Documents issued by the government that are valid address proofs need to be submitted alongside ID proofs. These include Electricity Bill, Ration Card, PAN Card, etc.
Financial Documents: Copies of the ITR for the last year as well as the financial statements audited by a CA for the last 3 years are needed.
Proof of Ownership: Documents related to proof of ownership are also required. Different documents are needed for different types of businesses (sole proprietorship or partnerships).
To obtain a business loan in Bangalore, some other factors also need to be kept in mind, which will directly or indirectly affect the time a financial institution takes to process the loan. A financial institution always calculates the creditworthiness of an entity before processing the loan. These factors which affect the eligibility of an entity include CIBIL score, past record of tax and EMI payments, credit utilization ratio, etc. Higher the CIBIL score of an entity, greater are the chances that the entity will be eligible for a higher loan amount. The business loan interest rate also depends on these factors. In addition to this, if the track record of the entity with respect to past payments is good, there is a good chance to obtain a higher loan amount.