An existing business needs a lot of cash to keep running smoothly!
To ensure that this cash is always at a higher level, the existing business maintains working capital. The purpose of a working capital is to reserve cash which can be used for multiple needs. These needs are related to;
- Daily and short term payments
- Paying wages and bonus to labor
- Bills related to utility and other segments
- Expenses related to machinery and equipment
- Any other requirement which involves the need for cash.
It is not always possible for an existing business to maintain cash all the time. Hence when they need monetary help, opting for a business loan is the best choice. With the business loan amount, one can tackle any issue which affects the stability and smooth running of the business.
But getting a business loan is not so easy. There are various requirements that a business person must fulfill in order to get a loan. In order to ensure you can fulfill all these requirements, we are listing down certain factors that might affect your chances in getting a business loan. Apart from the documentation, if you can focus on these aspects and be ready, then getting a business loan for your existing business will not be a problem.
- Your age of the existing business: When an existing business opts for a business loan, the Banks and NBFCs will always look at the stability and age of the business. According to them, any existing business with at least 3-5 years of existence can apply for a business loan. The reason of this number is because the lenders require income tax returns for at least 36 months to analyze and understand your credibility.
- Your money making ability: Apart from the income tax returns, they will also need a list of your profit making for a minimum of 36 months. They will analyze that statement to understand if your business is surviving and is making money. The main reason however is that they want to check if you will be able to repay the whole loan amount back without any defaulting.
- Your credit profile: After checking these basic facts regarding your existing business, the Banks and NBFC’s will check your credit history. This involves a thorough scan of your past credit history and your current credit score. If the business did not witness more instances of bounced cheques and always handled their debt and repaid it within time, then a business can surely get a business loan.
Why should you choose Ruloans?
With over a decade of experience, we can help you with all your requirements related to business loans. Our staff is well versed with the banking norms and can understand your needs. We help you borrow right by helping you fill the form and get your documents uploaded. You can compare business loan interest rates on our page to find out how you can get a quick business loan anywhere in India.
Hence if you have a need for business loans