Business loans are one of the important funding instruments which business owners can use to fund costs related to their company. Thus, if you are looking for funds for working capital, equipment financing, expansion of business, hiring new staff, project, or any other business related need, then here are the top business loan offers by banks and NBFCs you need to check out right away.
Top Business Loan Offers by Banks and NBFCs
Below-mentioned are details of company loans by financial institutions:
The retail business loan scheme by the bank offers up to Rs. 50 lakhs as the borrowing amount. Tenure is between 12 months and 60 months. The loan amount for working capital is between Rs. 30 lakhs and Rs. 3 crores. Tenure is determined as per individual’s profile. Interest rate starts at 10%.
- There are several Agricultural and Food loans as well such as Krishak Sahyogi, Small agriculture enterprise loan, commodity finance against agricultural commodities, and Agri joint liability group funding the economically weaker sections.
- The Cash Backed Lending Program offers non-fund based credit with letter of credit, bank guarantee, buyer’s credit.
- The Channel Finance scheme caters to supply chain system for dealers of corporate. Here, you can withdraw deposit in units as low as Re. 1. You can receive a steady flow for working capital. Flexible payment options are available.
- There are SME loans such as YES Samriddhi (loan for businesses involved in trading, manufacturing, and services with maximum quantum of finance Rs. 2 crores or Rs. 4 crores, and 12 months to 60 months tenure).
- YES Suyog (loan for SME businesses in manufacturing, trading, and services sector with loan up to Rs. 2 crores, and preferential rates on good credit score and profile).
- YES GST (up to Rs. 1 crore through overdraft or drop-line overdraft and assessment of the loan is based on turnover as per GSTR 1 returns).
The loan is collateral-less, with borrowing amount up to Rs. 50 lakhs for a period of 12 months to 48 months. Minimum loan amount is Rs. 75,000. The rack rate interest starts at 15%. No prepayment is allowed until you repay EMIs of 6 months.
- Prepayment charge is 4% of the principal outstanding, if prepaid between 7 months and 24 months.
- The charge for prepayment is 3% of the principal outstanding, if prepaid between 25 months and 36 months.
- Processing fee is up to 2.50% of the loan amount. Minimum and maximum fee is Rs. 2,359 and Rs. 88, 500, respectively.
State Bank of India
SBI provides business loans to large companies and SMEs. Both secured and unsecured lending is done by the bank. It also supports government-provided loan schemes such as CGTMSE, PM Mudra Yojana, Stand-up India, and PMEGP. As an applicant, you can go through the SBI loan schemes to select the one suitable for your needs.
- The lowest rate is 8.25% on CGTMSE. The bank offers asset backed loan at 10.70% onward.
- Some of the business loan schemes by SBI are Doctor Plus 10.25% onward, Medical Equipment Finance Scheme 10.40% onward.
- Arthias Plus Scheme 9.40% onward, Cotton Ginning Plus 9.30% onward, Dal Mill Plus 9.30% onward, SME Construction Equipment Loan 9.90% onward.
- Lease Rental Discounting 11.50% onward, and SBI Fleet Finance Scheme 9.15% onward.
Loan amount is between Rs. 1 lakh and Rs. 40 lakhs. Processing fee is up to 3% of the loan amount. Interest rate is 15% onward. Tenure is 1 year to 5 years. Pre-approved loan offers are also available. There are special loan offers for engineers, doctors, SME, etc.
- Prepayment charges are 2% of the outstanding principal with applicable taxes.
- Foreclosure charges are 4% of the outstanding principal with applicable taxes.
- EMI bounce charge is Rs. 3,000 including the taxes. Age eligibility is 25 years old to 55 years old.
Borrowing amount is between Rs. 1 lakh and Rs. 50 lakhs. Interest rate is 19% onward. Tenure is between 12 months and 48 months. Age eligibility criterion is between 27 years and 65 years to avail the loan. Business vintage must be at least 3 years.
- Besides the general business loan schemes for self-employed individuals, there are special business loan schemes for women, Chartered Accountants, and doctors.
- There is no need to pledge or mortgage any security.
- Facility of prepayment and foreclosure are available.
IIFL business loan is for partnership firms, sole proprietorship firms, private limited companies, and businesses involved in services, trading, and manufacturing. Quantum of finance is between Rs. 1 lakh and Rs. 7.5 lakhs over 12 months to 36 months.
- Interest rate starts at 25%. Processing fee is up to 3% of the loan amount.
- 4% of the outstanding amount is chargeable on opting for prepayment. Rs. 500 per instance is chargeable for dishonour of PDC/ECS/ACH.
- 2% per month on overdue amount is chargeable as late payment penalty.
Tata Capital Finance
Tenure for the loan is between 12 months and 36 months. You can borrow between Rs. 3 lakhs and Rs. 50 lakhs. Interest rate starts at 17%. Overdraft facility is also available. The financial institution offers working capital loans, MSME and SME loans, machinery loans, etc.
- To be eligible for the loan, the company must showcase 3 years vintage and a constant cash profit and growth over the past 2 years.
- There are two patterns of EMI: Fixed and Structured. In the former, you have to pay same EMI amount through the tenure. This scheme is apt if you have a regular source of income.
- In the structured EMI scheme, there are two options: Step up Flexi EMI plan (at the start pay lower EMIs, and higher towards the end), and Step down Flexi EMI plan (at the start pay higher EMIs and lower one towards the end).
The Capital First offers business loans to manufacturers, traders, retailers, partnership firms, sole proprietorship firms, closely-held limited companies, and private limited companies. It also has schemes for self-employed professionals and individuals such as doctors, Chartered Accountants, etc. You can borrow up to Rs. 75 lakhs on tenure up to 5 years. Interest rate starts at 21%. Top-up option is available for existing borrower.
- Age eligibility criterion is 28 years and 68 years.
- Company turnover in a year must be over Rs. 1 crore.
- The establishment must show at least 2 years of constant good profit over tax.
- Credit score must be at least 750 and business must be in existence for at least 3 years.
Quantum of finance is between Rs. 2.5 lakhs and Rs. 20 lakhs for tenure 12 months to 36 months, on an interest rate starting at 16%. Secured and unsecured business loans are available. Age eligibility is between 27 years old and 65 years. Those who can apply for the loan are sole proprietorship firms, professionals, private limited companies, partnership firms, etc.
- The business must show a profit over the last 3 years. Minimum turnover for the year must be Rs. 1 crore for service sector and professionals.
- As an applicant, you must possess at least 5 years of experience.
- The business in question must have been in operation for the past 3 years in the same city.
- If you are a self-employed professional, then it is a must to possess a minimum of 4 years of post-qualification experience.
Borrowing amount is between Rs. 3 lakhs and Rs. 50 lakhs. Interest rate starts at 14.25% onward. Tenure is between 12 months and 36 months. Axis Bank offers several business loan schemes such as working capital finance, lease rental discounting, export finance, trade finance, construction finance, term loans, and project finance. There are no foreclosure and prepayment charges. No collateral is required to get the loan.
- Processing fee is up to 2% of the loan amount along with the applicable taxes.
- Penal interest is 2% per month over the overdue instalment amount.
- Business annual turnover must be Rs. 30 lakhs to Rs. 10 crore.
- Age eligibility criterion is between 21 years old and 65 years old.
Loan amount is between Rs. 1 lakh and Rs. 40 lakhs starting at interest rate 15%. Tenure is between 6 months and 48 months. The bank offers financial assistance to SMEs and corporate. It provides working capital finance, GST business loan, instant overdraft, and term loans.
- The bank considers the financial position and credit history of the business along with other factors to approve the loan.
- Customized MSME solutions include loans without financials, loans for new entities, collateral-free loans, finance for exporters and importers, secured loan against credit swipe to merchant establishments, and loans for schools and colleges.
- There are also specific loan scheme for educational institutions, construction business, pharmaceuticals, and information technology businesses.
Kotak Mahindra Bank
Kotak Mahindra Bank offers other loan schemes than standard ones, such as crop loans, working capital loan, commercial vehicle financing, agriculture project loan, farm equipment loan, infrastructure loan, construction equipment loan, etc. Borrowing amount is between Rs. 3-5 lakhs and Rs. 75 lakhs to Rs. 2 crores. Tenure is between 6 months and 48 months. Interest rate starts at 16% to 19.99%.
- Processing charges are up to 3% of the loan amount. Flexible repayment options are available.
- Annual turnover must be Rs. 2 crores minimum for the company to qualify for the loan, whereas, manufacturers must have at least Rs. 1 crore as annual turnover.
- The annual turnover requirement for service providers is Rs. 50 lakhs.
- As a loan applicant, you must have last 3 years as experience in the current business
- The business should have at least 2 years of audited profit and loss sheet.
The above-mentioned 12 banks and NBFCs business loan schemes are the most sought-after in India. You must compare loan offers across financial institutions and pick the one most suitable for your needs. Remember to go through the details regarding the eligibility criteria, quantum of finance, end-use of the funds, interest rates, fees, charges, documents required, annual turnover requirement, and other aspects in detail before applying for a loan offer.