A Checklist Before You Apply For A Business Loan
Banks offer business loan to borrowers who fulfill their designed eligibility. The eligibility criteria changes from bank to bank and the profile of the borrower. But there are some commonalities which you have to follow or acquire to get a business loan from any bank. Before going to the bank and getting a list of their specified required list of eligibility and documents, you should have the following things ready.
1. Check your Age Criteria:
Banks and NBFCs offer a wide range of business loans in mumbai to the borrowers. But they have a specific age criteria to grant the loan. The applicant has to be minimum 25 years old and maximum 65. It’s the primary criteria to grant a loan. Banks do not bend their rules for this criterion.
2. A Strong Business Plan:
To get a business loan from a bank, you need to prepare a business plan. This will include your proposed idea for business, company details, product details, partner and team details, market space and financials. Many banks also accept a lean business plan which only touches the earlier mentioned topics. If your business plan is attractive enough and can assure that you can repay the loan on time, the loan approval process gets a fast kick.
3. Business’s all financial details audited and reviewed neatly:
You need to get all your business related financial documents together. This will include pan card, tax details, wholesome contact details, addresses, past and current loan accounts, investment accounts, debt incurred, credit card details, balance sheet or profit and loss account details etc. These documents should be thoroughly audited by the CA.
4. Details of Account Receivable:
Account receivable means the money owed to you by your customers for the product or services you provided. To understand the credit, sales and payment history of the applicant, banks has to check these accounts. This includes account by account details. If by any chance the applicant do not have a detailed account of receivable, it should be made clear to the bank while applying for the loan.
5. Details on Account Payable:Just like account receivable the applicant has to give the statements of payable amount. The applicants should give the details of the payment made by them while purchasing services or products for business needs. This will include receipts, challans and credit references. This includes account by account details. If by any chance the applicant do not have a detailed account of payable, it should be made clear to the bank while applying for the loan.
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