Best NBFC for Business Loan {2023}

Best NBFC for Business Loan

Best NBFC for Business Loan

In recent years, non-banking financial companies Best NBFC for Business Loan (NBFCs) in India have undergone a significant transformation in the way they operate. Businesses prefer NBFCs for obtaining loans because of the flexible loan terms and less strict eligibility criteria. NBFCs offer different types of loans, enabling business owners to choose a loan that suits their needs and purpose.

NBFCs also contribute to the financial system, accelerate infrastructure development, and create employment. According to a recent Financial Stability Report from the Reserve Bank of India, NBFCs perform better than banks and are increasingly contributing to the growth of the Indian economy.

NBFC Loan FinanceFeatures In India:-

When traditional banking institutions are unable to meet the requirements of small-scale enterprises that are expanding, businesses turn to Best nbfc for Business Loan for loans. The following points illustrate how the availability of business loans from NBFCs in India is positively impacting businesses:

  1. NBFCs provide loans with flexible terms and less strict eligibility criteria compared to banks.
  2. The variety of loan options offered by NBFCs allows business owners to select a loan that fits their specific needs.
  3. NBFCs contribute to the financial system, infrastructure development, and employment.
  4. The growing popularity of NBFCs has resulted in improved access to finance for small-scale businesses, which in turn has improved their growth prospects.

Overall, the availability of business loans from NBFCs has been a game-changer for small-scale businesses in India.

Relaxed Lending Norms:-

In recent years, the Indian economy has seen the emergence of many micro, small, and medium enterprises (MSMEs), which contribute significantly to the country’s GDP. However, these small-scale businesses have unique lending requirements, and obtaining a loan from a traditional bank involves a lot of time, paperwork, and collateral.

NBFCs have emerged as an attractive option for MSMEs as they offer more relaxed lending norms. These companies have become the go-to option for small businesses to obtain funds quickly and easily. In some cases, NBFCs do not require collateral for business loans, making the process even more hassle-free. NBFCs have made the process of obtaining funds more relaxed than ever before.

Pre-Approved Loan Limit:-

When businesses take out a loan from an NBFC, they are given a pre-approved loan limit. They can withdraw funds from this limit as needed, without having to seek multiple approvals from financing institutions. Additionally, businesses are only required to pay interest on the amount they withdraw from the approved limit. In contrast, banks require businesses to pay interest on the entire loan amount, regardless of how much they actually use.

As a result, procuring a business loan from an NBFC is more advantageous for businesses since they only have to pay a lower monthly EMI. This approach benefits businesses by reducing their financial burden and allowing them to focus on their growth and expansion plans.

Flexi-Business Loan Options:-

Flexi interest-only business loans are a type of loan offered by NBFCs that allows businesses to pay only the interest amount in monthly EMIs, with the principal amount due at the end of the loan period. This approach further decreases the monthly EMI amount, making it easier for businesses to manage their finances.

NBFCs are transforming the way business loans are obtained in India, and are meeting the loan requirements of Indian businesses in the most convenient way possible.

Best nbfc for Business Loan
Best nbfc for Business Loan

Eligibility Criteria:-

Banks typically have rigorous lending criteria that involve extensive verification and documentation before approving a business loan. They also require a high credit score, significant business experience, and a certain annual turnover. This process can be time-consuming and energy-intensive for borrowers.

On the other hand, NBFCs have a simpler approval process for loan applications. They provide a seamless approach to financing for their customers, making it easier for borrowers to qualify for loans with a low credit score and little business experience. As a result, obtaining a loan from an NBFC is a hassle-free process.

Digital Loan Disbursal Process:-

In today’s digital world, physical documentation is becoming less prevalent. Many NBFCs now offer 100% paperless business loans through digital platforms.

As a result, business owners can apply for funding from these fintech companies without leaving their homes or offices. Simply visit the financial company’s website or download the app on your smartphone to apply for an online business loan. You can upload the required documents, and the company will transfer the money to your bank account within 24 hours of approval.

On the other hand, most banks still require physical copies of documents and in-person visits to a branch for confirmation. This traditional process is time-consuming and takes away valuable time and effort that could be spent on your business.

Interest Rates:-

Getting funding for your business can bring joy, but it also means you’ll have to pay interest on the loan. Higher interest rates result in higher monthly payments, which can be a burden for business owners. However, NBFCs offer lower interest rates compared to traditional banks, which reduces the pressure on borrowers when availing the loan.

NBFCs can offer lower interest rates as they are not regulated by the Reserve Bank of India (RBI) and can set their interest rates according to the Prime Rate (PLR). This flexibility allows them to change interest rates on business loans to attract more customers. Furthermore, the loan processing fees and other charges levied by NBFCs are also lower compared to traditional banks.

Best nbfc for Business Loan
Best nbfc for Business Loan

A Pre-Approved Loan Limit:-
Many NBFCs in India provide pre-approved business loans with a restricted credit limit. It’s worth noting that interest is calculated only on the withdrawn amount by the business owner, not the entire credit limit available. This feature assists companies in keeping their monthly EMI payments low, resulting in additional savings. Furthermore, the pre-approved credit limit enables companies to reapply for business loans when required, especially if they face a cash crunch
Apply For A Business Loan With IIFL Finance:-

IIFL Finance is a top provider of business loans, assisting countless business owners for over 30 years with a hassle-free experience. Our low-interest business loans are ideal for MSMEs with financial needs up to INR 30 lakh, and we make sure that you can focus on your business operations without any hassle. With IIFL Finance, the entire loan process is completed online, from application to disbursement.

 NBFC Instant Loan Requirement:-

To speed up the loan approval process, it is essential to keep the following documents ready and up-to-date, even though they may not be mandatory at the time of application:

  • GST returns
  • Income tax returns
  • KYC verification documents of the company
  • Board Resolution
  • Bank statement
  • KYC documents of business owners
  • Business continuity proof
  • A copy of the filled application forms

Having these documents readily available and verified can help business owners obtain loans from NBFCs quickly. NBFCs typically request these documents at the start or during the approval process. It’s essential to keep them organized to avoid any delays.

Top 10 Best Banks & NBFCs to Apply for Business Loans

ICICI Bank:-

ICICI Bank provides a comprehensive range of Business Loans to cater to the financial requirements of any business enterprise. With its efficient operations, ICICI Bank guarantees speedy and hassle-free processing of loans. The minimal documentation required, competitive interest rates and fast processing time make it an attractive option in the market. Business Loans by ICICI Bank in India start from as low as Rs. 1 Lakh and go up to Rs. 10 Crore, with interest rates starting from as low as 12.9% per annum, and a maximum loan tenure of 60 months. The processing fee charged is subject to a maximum of 2% + GST as applicable.

HDFC Bank:-

HDFC Business Loan is a great option for business owners as it offers many benefits. The loan is collateral-free, and the processing is quick with minimal documentation. This makes it an attractive opportunity for entrepreneurs to fund their business requirements at a competitive interest rate starting from 12.75% per annum. HDFC Bank offers unsecured Business Loans of up to Rs. 50 Lakh with a maximum repayment tenor of up to 48 months. The processing fee charged by HDFC Bank for its Business Loan is up to 2.50% of the loan amount.

Fullerton India:-

Fullerton India is a company that offers financing solutions for Small and Medium Enterprises in India. With 636 branches across India, it offers a range of Business Loans suitable for various business needs. Its quick processing and collateral-free offerings make it stand out from competitors. Fullerton offers unsecured Business Loans ranging from Rs. 10 Lakh to Rs. 50 Lakh with attractive interest rates starting from 13% and a maximum repayment tenor of 48 months. The processing fee charged by Fullerton India is up to 6.5% of the loan amount plus GST.

Kotak Mahindra Bank:-

Kotak Mahindra Bank provides collateral-free Business Loans with a quick, easy, and hassle-free application process. It sanctions Business Loans within 72 hours and offers Fund against Credit Card Receivables (FCCR) with a loan amount of up to Rs. 3 Crore. Kotak Mahindra Bank offers unsecured Business Loans for up to Rs. 75 Lakh with interest rates ranging from 11.69% – 15% and a repayment tenor of up to 48 months. The processing fee for a Kotak Mahindra Business Loan is up to 2% of the loan amount + GST as applicable.

IDFC First Bank:-

IDFC First Bank, formed after the merger of IDFC Bank and Capital First, provides a range of unsecured Business Loans to cater to different operational requirements. These loans are collateral-free, making it easier for businesses to obtain them. Additionally, existing customers can opt for a Top-Up facility to borrow additional funds over and above their current loan amount. The bank offers unsecured Business Loans ranging up to Rs. 75 Lakh with attractive interest rates starting from 11.69% and a flexible repayment period of 12-60 months. The processing fee for IDFC Business Loan is up to 2.50% of the loan amount.

Tata Capital Business Loans:-

Tata Capital provides Unsecured Business Loans with flexible EMI options that can be customized to suit the specific needs of your business. These loans are available in a range from Rs. 5 Lakh to Rs. 50 Lakh with interest rates starting at 18%. The repayment tenor can be up to 36 months. The processing fee for Tata Capital Business Loan can be up to 2.75% of the loan amount plus GST.

Federal Bank:-

Federal Bank provides Business Loans to eligible and authorized professionals such as Doctors, Chartered Accountants, and Architects with at least 4 years of experience at attractive interest rates. Business Loans up to Rs. 3 Crore can be quickly availed with a longer repayment period of up to 84 months. Interest rates for Federal Bank Business Loans are linked to MCLR and may differ based on the repayment tenor.

SBI Business Loan:-

SBI offers a Smart Backed Asset Loan for business needs, which requires the borrower to mortgage collateral. The loan amount can be used for various purposes such as working capital, business expansion, and asset purchase. SBI Business Loans are available from Rs. 10 Lakh up to Rs. 20 crores at competitive interest rates linked to MCLR. The processing fee for SBI Asset-Backed Business Loan is 1% of the limit amount sanctioned.

Lendingkart Finance Ltd:-

Lendingkart Finance Ltd is a financial company that provides unsecured Business Loans of up to Rs. 1 crore within 72 hours and at attractive interest rates. They require minimal documentation and offer quick processing, making it a convenient option for business owners. With so many Business Loans available in India, cash shortages will no longer hinder achieving desired business goals effectively and efficiently.

Edelweiss Financial Services:-

Edelweiss Financial Services provides both secured and unsecured Business Loans to cater to the funding requirements of business owners, and small, and micro-enterprises. A dedicated relationship manager assesses the funding needs of the customers and offers a customized funding solution.

Secured loans are offered against the collateral of fixed assets and range from Rs. 3.5 Lakh to Rs. 25 crores, with a repayment tenor of up to 180 months, and interest rates starting from 18% per annum. The processing fee may vary from up to 2% – 3.5% + GST, as applicable.

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