Frequently Asked Questions

Basic eligibility criteria include:

• Business Age: Minimum 1-2 years of operations
• Annual Turnover: Minimum ₹10 lakhs (varies by loan type)
• Credit Score: Preferably 650+ (negotiable based on other factors)
• Business Registration: Proper business registration documents
• Banking History: Minimum 6-12 months of banking relationship
• Age: Applicant should be 21-65 years old
• Profitability: Business should be profitable for at least 1 year

Note: Criteria may vary based on loan type, amount, and lender policies.

Yes, you can get loans for newer businesses through:

• MUDRA Loans: For businesses up to ₹10 lakhs
• Startup Loans: Special schemes for new businesses
• CGTMSE Loans: Collateral-free loans for MSMEs
• Personal Loans for Business: Based on personal income/assets
• Secured Loans: Against property or other collateral

Requirements for new businesses:

• Strong business plan and projections
• Good personal credit score
• Relevant business experience
• Adequate margin money/investment

Loan amounts vary by type and lender:

Actual loan amount depends on your eligibility, business financials, and repayment capacity.

Credit score requirements vary by loan type:

• 750+ Score: Best interest rates and higher loan amounts
• 700-750 Score: Good rates with standard terms
• 650-700 Score: Moderate rates, may need additional documents
• 600-650 Score: Higher rates, collateral may be required
• Below 600: Secured loans or co-applicant needed

Options for low credit scores:

• Secured loans against property/assets
• Loans with guarantor or co-applicant
• CGTMSE scheme loans
• Start with smaller amounts to build credit

Personal Documents:

• PAN Card of applicant and co-applicant
• Aadhaar Card or Voter ID
• Passport size photographs
• Residence proof (utility bills, rent agreement)

Business Documents:

• Business registration certificate
• Partnership deed (for partnerships)
• MOA & AOA (for companies)
• GST registration certificate
• Trade license/Shop establishment license
• Business PAN card

Financial Documents:

• Bank statements for last 12 months
• ITR for last 2-3 years
• Audited financial statements
• GST returns
• Sales invoices and purchase bills

No, you don't need to submit original documents initially.

Document submission process:

• Application Stage: Self-attested photocopies are sufficient
• Verification Stage: Originals may be required for verification
• Final Approval: Some lenders may keep photocopies of key documents
• Digital Process: Many banks now accept scanned/digital copies

Tips:

• Keep all documents ready in both physical and digital format
• Ensure all photocopies are clear and legible
• Self-attest all copies with signature and date

GST registration is not mandatory for all loan types.

Loans available without GST:

• MUDRA loans (up to ₹10 lakhs)
• Small business loans for service providers
• Professional loans for doctors, CAs, etc.
• Loans for businesses with turnover below GST threshold

Alternative documents you can provide:

• Shop & Establishment license
• Trade license
• Professional registration certificates
• Service tax registration (if applicable)
• Bank statements showing business transactions

Note: For larger loan amounts, GST registration may be preferred by lenders.

Bank statement requirements vary by loan amount and type:

What banks look for in statements:

• Regular business transactions
• Healthy account balance
• No frequent overdrafts or bounces
• Consistent cash flow patterns

Loan approval timeline depends on loan type and amount:

Factors affecting processing time:

• Completeness of documentation
• Credit score and business profile
• Loan amount and complexity
• Bank's internal processes
• Property valuation (for secured loans)

Our streamlined loan process:

Yes, we provide complete transparency in tracking your application:

• Regular Updates: We keep you informed at every stage
• Direct Communication: Direct contact with our loan expert
• Bank Portal Access: Help you access bank's online tracking system
• Status Notifications: SMS and email updates on progress
• Issue Resolution: Quick resolution of any queries or issues

Typical status updates you'll receive:

• Application submitted to bank
• Documents under verification
• Credit assessment in progress
• Technical/legal verification (if applicable)
• Final approval/sanction
• Disbursement completed

If your application is rejected, we don't give up:

• Reason Analysis: We analyze the rejection reasons with you
• Alternative Options: Explore other banks or loan products
• Profile Improvement: Suggest ways to strengthen your application
• Reapplication Strategy: Plan for future applications
• No Additional Charges: No extra fees for exploring alternatives

Common rejection reasons and solutions:

• Low Credit Score: Apply for secured loans or improve credit
• Insufficient Income: Try for lower amounts or add co-applicant
• Incomplete Documents: Complete documentation and reapply
• Business Vintage: Wait or try alternative lenders

Our success rate is over 85% due to proper pre-screening and bank selection.

Interest rates vary by loan type, amount, and your profile:

Factors affecting interest rates:

• Credit score and credit history
• Business vintage and stability
• Loan amount and tenure
• Collateral/security offered
• Banking relationship
• Market conditions

Rates are subject to change. We help you get the lowest possible rates.

Loan tenure varies by loan type and amount:

Choosing the right tenure:

• Shorter Tenure: Higher EMI but lower total interest
• Longer Tenure: Lower EMI but higher total interest
• Consider Cash Flow: Match EMI with business cash flow
• Prepayment Option: Choose loans with prepayment flexibility

Collateral requirements depend on loan type and amount:

Collateral-Free Loans:

• MUDRA loans (up to ₹10 lakhs)
• CGTMSE loans (up to ₹2 crores)
• Small business loans (up to ₹25 lakhs)
• Unsecured working capital (up to ₹50 lakhs)

Collateral Required:

• Large term loans (above ₹1 crore)
• Machinery loans (equipment as collateral)
• Loan against property
• High-value working capital facilities

Acceptable Collateral:

• Residential/commercial property
• Fixed deposits
• Machinery and equipment
• Inventory and receivables
• Life insurance policies

CGTMSE (Credit Guarantee Fund Trust for Micro and Small Enterprises) is a government scheme that provides collateral-free loans.

Key Benefits:

• No Collateral: Loans up to ₹2 crores without security
• No Third-Party Guarantee: No need for guarantors
• Credit Enhancement: Improves loan approval chances
• Lower Interest Rates: Competitive rates due to guarantee

Eligibility:

• Micro and Small Enterprises (MSEs)
• Manufacturing units with investment up to ₹10 crores
• Service enterprises with investment up to ₹5 crores
• New and existing enterprises

Coverage:

• 85% guarantee for loans up to ₹5 lakhs
• 80% guarantee for loans above ₹5 lakhs
• 75% guarantee for loans to existing units

Prepayment policies vary by lender and loan type:

Generally No Penalty:

• MUDRA loans
• MSME loans (most banks)
• Floating rate loans
• Loans after 1-2 years

May Have Penalty:

• Fixed rate loans
• Prepayment within first year
• Large loan amounts
• Special promotional rate loans

Typical Penalty Structure:

• Year 1: 2-4% of outstanding amount
• Year 2: 1-2% of outstanding amount
• Year 3+: Usually no penalty

Benefits of Prepayment:

• Reduces total interest burden
• Improves credit score
• Frees up borrowing capacity
• Reduces financial stress

Missing EMI payments can have serious consequences:

Immediate Impact:

• Late Payment Charges: 1-3% per month on overdue amount
• Penal Interest: Additional 1-2% on outstanding amount
• Credit Score Impact: Negative impact on CIBIL score

Progressive Actions:

• 30 days: Reminder calls and notices
• 60 days: Account marked as irregular
• 90 days: Account becomes NPA (Non-Performing Asset)
• 120+ days: Legal action may be initiated

What to Do if You Can't Pay:

• Contact Bank Immediately: Explain your situation
• Request Restructuring: Ask for EMI reduction or moratorium
• Partial Payment: Pay whatever amount possible
• Seek Help: Contact us for assistance in negotiations

Prevention is better than cure - maintain adequate cash flow and communicate proactively.