Undoubtedly, finance is an imminent factor to keep the business machine running. And, it becomes more critical when we talk about meeting business expenses on a day-to-day basis. Let’s look at Rahul’s story. Rahul has been running his business for past three years. He requires around Rs. 1 lakh per month to meet his operational expenses such as staff salaries, utility bills (telephone, electricity, and water), office rent, supplier payments and other miscellaneous expenses. The business pattern over the last three years has revealed that the second quarter of the years i.e. April to August is relatively slow meaning monthly revenues rarely touch Rs. 50,000 as against Rs. 2.50 – 3-lakh monthly revenue during the other quarters. So, if Rahul was to solely rely on the monthly revenue then his business would have wrecked during the lean quarter. The salaries of his staff would have got delayed, utility bills, office rent, and supplier payments would have remained unpaid, bringing upon a chaotic situation. But, fortunately, Rahul was wise enough to take a working capital loan to meet the operational expenses during the lean quarter.
Now, I am going to tell you how Tata Capital’s working capital loan can help you manage business expenses efficiently. As known, the working capital loan is a type of business loan or commercial loan offered by lenders to meet daily operational expenses of a business. With the availed funds you can pay rent of your commercial space, salaries of your staff, utility bills, inventory purchase, marketing expenses, and the like. Tata Capital offers working capital finance in the form of cash or credit to best suit your business requirement. The advantage of Tata Capital working capital loan is that it can be availed as Working Capital Term Loan(WCTL) or Working Capital Demand Loan (WCDL), after careful assessment of your business needs and risk profile by a Tata Capital representative.
There are three types of working capital loan – Overdrafts, Cash Credit Accounts, and Non-Fund Facilities for Letters of Credit, Bank Guarantees etc. – and all the three types are offered by Tata Capital. Overdrafts will help you meet routine business expenses and is linked to your Current Account. Cash Credit Account is a credit facility with a higher loan limit compared to overdraft, but, will be granted to you against collateral. You can use it to meet recurring expenses like staff salaries, utility bills, taxes, and creditor dues. You can use Non-Fund Facilities to pay for deposits, guarantees, and letters of credit that your clients may require as additional security. Besides, working capital loan, the other types of business loans and financial services offered by Tata Capital are Term Loans (Short term / Long term), Invoice Discounting / Factoring, Structured Financing, Debt Syndication and Advisory Services, Loan against Shares, and Vendor Financing. In conclusion, considering working capital loan is a good option to enable your business function more efficiently. And, I must admit that Tata Capital is a one-stop shop for convenient and need-specific business loans.