With the rising number of startups and entrepreneurs in the business landscape, the market for SMEs is growing rapidly. However, even today a large number of small business owners in India face multiple hurdles when it comes to getting funding for their business. In fact, a 2018 American Express survey revealed that a staggering 42% of Indian SMEs struggle with gathering funds. The surveyors stated that getting access to finance in India is much harder as opposed to their global counterparts.
Fortunately, several financial institutions are extending a helping hand to provide SME loan specifically tailored to meet the needs of small businesses. But yet, the stigma around availing business loans and enduring the loan burden has been stopping entrepreneurs from taking loans which are, in fact, a saviour and offer the push they need to scale business.
So, yes, SMEs should definitely opt for a business loan to get hassle-free funding. Moreover, lending institutions like NBFCs understand that SMEs do not have the collateral required to qualify for a loan and hence, offer unsecured business loans that are easy to avail. But if you’re still on the fence about availing a loan for business, check out these amazing benefits that business loans have to offer.
- Minimal Documentation
When availing unsecured business loans, the zero collateral factor can speed up the application process. All you require are basic documents like your KYC papers such as identity and residence proof, income proof such as bank statements and income tax returns and lastly, your credit report which determines your creditworthiness for repaying the loan.
- Shorter Tenures
Most SME loans possess short deadlines, requiring the loan seeker to repay their loan amount quickly. This helps businesses plan their budgets easily, avoid long-term liabilities and reduce the burden of taking out a loan. Moreover, certain NBFCS offer flexible SME loans that are tailored to match the exact requirements of the client and make access to capital much easier.
- Improved Credit Score
Applicants having a poor credit score or applying for a loan for the first time can easily rectify past mistakes and simultaneously build a strong credit report with SME business loans. The reason for this is that their short tenure along with timely payments increases your credit score far more significantly than long-term loans, making entrepreneurs eligible for higher loan amounts in the future.
Looking to avail unsecured business loans with speedy disbursals? Check out NBFCs like Tata Capital that require minimal documentation, offer attractive business loan interest rates, flexible EMI and a business loan EMI calculator to help businesses avail loans effortlessly and accomplish all their career goals.