As an aware and astute business owner, the importance of having the right finance at the right time is not lost on you. Oftentimes, it can be the deciding factor that can catapult you to the next phase of growth, and at other times, it can serve as a financial aid of sorts, stepping in when your internal resources are stretched in.
Regardless of why you require business finance for your small enterprise, knowing how to secure a suitable loan is step 1 of the process. Fortunately, it’s easy and just requires you to be mindful of a few technicalities. Following these steps will certainly help you get the money your business needs on time.
Know your requirements inside out
The first task on your list is to evaluate why your business needs funds from an external source and how much. If you have several areas that could benefit from financing, list them, prioritise the items and segregate them by whether they’re integral to your core operations and have a direct impact on your financial, or whether they’re ancillary expenses that will help you in the long term.
For instance, if you run a manufacturing unit and are considering adding machinery to enhance your output so that you can cater to larger orders, this need is integral to your business. On the other hand, renovating your office will certainly improve comfort for visitors and cast a good impression, but it’s not central to your organisation’s productivity.
Check your repayment capacity
A loan is helpful only when you’re 100% sure that you’ll be able to repay it on time. This means that even before you apply, you must forecast your firm’s ability to repay business finance. This is important for several reasons, the most important one being that you will be able to steer clear of any extra expenses that occur when you delay or default on payments and ensure that taking the loan doesn’t cost your firm. A smart way to start this process is to use a business loan EMI calculator to forecast your monthly expenditure towards the loan.
Have your projections ready
As a small business owner, you’re sure to be cognizant of how important it is to account for every rupee. When you approach a financial institution for business finance, they have the same outlook. This means that they may have questions about how you will use the money and what your revenue projections are to ascertain whether you are a risky or risk-free candidate. This is why you must have the projections and your financial statements handy, as well as a clear answer to how you will appropriate funds from the business loan that you’re taking.
Check your eligibility and shortlist loans
Once basic research is out of the way, it’s time to start looking at business finance options that you have before you. Be sure that you take your time with this step so that you sign up for a loan that serves your interests in a cost-effective manner. Apart from checking the business loan interest rate and features, get confirmation on your eligibility by using a business loan eligibility calculator. One option that is tailored for your SME’s needs is an MSME/SME Loan from Bajaj Finserv. This business finance option gives you up to Rs.30 lakh without collateral, for a flexible tenor. It has minimal business loan eligibility criteria, offers approval in less than 24 hours and comes with a Flexi Loan facility that allows you to borrow from the total sanction as per your business finance needs and pay interest on what you use. As you juggle many roles within your organisation’s framework, it also allows you to apply online for added convenience. To expedite this process further, check your pre-approved offer from Bajaj Finserv and then apply.