Credit Wisdom

Factors that may affect your eligibility for taking business loan

Category: Business Loan

Having a business or starting a business means that you need to have a good amount of running capital to ensure that the things are all running quite smoothly. It is important to see the kind of work you want to do and get the loan that suits the same. Starting a business has a lot of work behind it and one of the major things that can make or break you is the kind of business loan you might be eligible for.

When you are looking for business loans, your eligibility criteria are very important. Here are some things you should definitely keep in mind before applying: 

One of the things you need to look out for is the age. If you are younger than twenty-five years, you will find it hard pressed to find a bank or an NBFC that is willing to give you a business loan. The same goes for anyone who is above sixty-five years old. Age is a very important factor in availing a business loan.

Your experience in the business sector and the market you are trying to get into is also very important. You need to have at least a three to five-year experience in the field to understand how it works and come up with a comprehensive plan for your business. This will help you convince the banks as well for a loan. While some banks and NBFC’s fund start-ups, many don't.

Your business should be making a good amount of money before you are eligible to ask for a loan. If your business or company is not making enough money to pay back the loan amount, then you will not be eligible for a business loan.

Your business loan eligibility also depends on the documents that you submit. To be considered for a business loan, you need to submit company and residence ownership proof, Form 16 of at least last two years, your account statement, savings statement and more. If you fulfil all these criteria, you are eligible for a business loan. There are some websites which not only give you guidance on taking a loan, but also help you in shopping for the right loan at the right bank or NBFC.

Tags: Business Loan Articles