Let’s face it! Running a business is impossible without adequate funds. Taking a loan for your growing business is a quick and easy way to meet your organisation’s financial needs.
However, a lot of business owners are hesitant to take this route due to numerous misconceptions. So here are some facts and myths about loans and EMI calculators for businesses.
Myth #1: They are hard to get
Fact: Contrary to popular opinion, getting a loan for your business is very convenient. The loan application process requires minimal paperwork, and the loan approval and disbursal process are swift.
Myth #2: You need a perfect CIBIL score
Fact: Your CIBIL score depicts your creditworthiness on a scale of 300 to 900, 300 being the lowest. You do need a good credit score, but it does not have to be a perfect 900. For most lenders, a score of 700 and above is enough to prove your business loan eligibility.
Myth #3: They’re expensive funding options because you borrow a hefty loan amount
Fact: The loan amount and tenure depend on your business needs. Typically, you can avail of a loan worth Rs. 5,00,000 to Rs. 75,00,000. Using a business loan EMI calculator, you can decide on a loan amount you can comfortably repay.
Myth #4: Business EMI calculators are hard to use
Fact: EMI calculators are easy-to-use tools. All you need to do is enter the amount you’d like to borrow, the approximate time you’ll take to repay it, and the calculator will estimate your EMI amount.
Using the loan calculator, you can plan your instalments, manage additional business expenses, and timely pay off the loan.
Pro-tip: You can use this tool to compare lenders and plan your monthly budget.
Myth #5: Business loan interest rates are high
Fact: If your business is flourishing and you have a good repayment record, you can negotiate with your lender to qualify for more competitive rates of interest. To bag lower interest rates, you need a healthy CIBIL score. Additionally, your business must have:
- A high annual turnover
- An upward trend in profits
- An excellent track record of repayment throughout your business tenure
To compare interest rates offered by different lenders, use an EMI calculator or a business loan interest rate calculator.
Myth #6: You can use the loan to fulfil only a handful of business needs
Fact: You can use business finance for almost any business requirement, no matter how big or small. If your business involves heavy use of tools and machinery, you can opt for a loan for business machinery. Whether you want to cover your organisation’s short-term expenditure and various intermittent expenses or want to manage your inventory, a loan can help.
Additional Read: What are Foreclosure Charges on Business Loan?
Do you wish to expand your business? Tata Capital offers you a business loan at competitive interest rates and flexible repayment options. Since all your myths about business loans have been busted, you can visit our website and apply for one today!