Interest Rates and Processing Fees on Business Loans
What is the Business Loan Interest Rate ?
At present we charge fixed interest rate in the range 19-23% for all business loans without collateral but only on the strength of the business. The rate depends on a number of factors such as the prime lending rate, credit rating of the borrower, antecedents of the business, monthly revenues, competitors and tenure of the loan. The borrower can command an interest at the lower end of the band if the scoring is high on all the parameters mentioned above.
Business Loan Interest Rate and Fees
The fees and charges pertaining to the business loans are as per the table below:
Business Loan Fees & Charges
|PDC Charges||Rs. 850|
|Bouncing Charges (per event)||Rs. 450|
|Cancellation Charges||2% of business loan amount or Rs. 5750 whichever higher|
|Swapping Charges (for payment mandate)||Rs.600|
|Foreclosure Charges||4.5% of the principal outstanding at the time of foreclosure along with applicable taxes, if any|
|Foreclosure Charges for Top Ups||2% on future principal outstanding on existing business loan + GST|
|Duplicate Repayment Schedule||Rs. 550|
|Legal action under Section 138 of Negotiable Instruments Act, 1881, and/or Section 25 of Payments and Settlements Systems Act, 2007||Rs. 3400|
|Initiation of Arbitration proceedings||Rs. 4000|
|Obtaining of Receiver Order from a District Court||Rs. 4000|
|Obtaining of Receiver Order from the High Court||Rs. 13500|
|Issue of Legal Notice (per notice)||Rs. 125 to Rs. 300|
|Execution of Award||Rs. 5600|
How is Business Loan Interest calculated ?
The interest is calculated on a monthly reducing balance method. In this method, when the EMI is paid monthly a portion of it is accounted against repayment of principal and the balance portion towards payment of interest. Similarly, in the next and subsequent EMI payments a portion goes towards repayment of principal and the balance towards payment of interest. Thus, at the end of the tenure the entire interest and principal are repaid through equated monthly payments.
What does your interest rate depend upon ?
The interest rate depends on a variety of factors that include
If your creditworthiness is high and the business credentials are sound then you are likely to be charged at the lowest rate of interest which is 19%.
Are you eligible to take a business loan ?
You are eligible to avail a business loan if you are a self-employed businessman or professional running the business in any of the following ownership formats
We also have a special business loan plan for pathological labs, diagnostic centers, nursing homes and hospitals.
The business loan eligibility criteria are set liberally so as to benefit a large number of businessmen and professionals to easily avail business loans for the enhancement of their business or profession. They include
The main features of the business loan include
You can check your detailed eligibility criteria for business loan before applying.
How Much EMI do you have to pay ?
Our business loans can be repaid with three EMI options. You can choose your own EMI option based on your comfort level. To help calculate your EMI we provide you with a Business Loan EMI calculator. EMI is a function of three variables - the loan amount, tenure and interest rate. You can use the calculator to change the variables and see which EMI is the most suitable for you.
What are the documents needed ?
We seek copies of standard documents from you that establish your credentials as per the eligibility criteria set by us as given above. They include