Important Financial Habits that can help get a quick Business Loan
News

Important Financial Habits that can help get a quick Business Loan

November 18, 2019

A business is set up with a lot of thought and planning going into it. An entrepreneur does not build a business enterprise based on dream alone. He relies on his skills, determination, and meticulous planning to attain objectives and goals defined in the mission statement. 

For any business to run, funds act as the lifeblood. Most of it comes from lenders who provide quick business loan to meet various needs of the business from time to time. However, a successful business does not run entirely on funds alone, but on prudent fund management. 

The importance of business loan:

A business plan which defines a clear road map for use of funds for the benefit of the enterprise stands the best chance to impress the lender to come forward with a quick business loan. 

Before we investigate the aspect of impact of financial habits that can help a business loan in Mumbai, let us find how a quick business loan can serve your purpose:

  • Purchase and replenish inventory
  • Manage and streamline cash flow
  • Purchase capital assets and equipments
  • Hiring of specialized staff, experts and consultants.
  • Expansion of business.
  • Cover for emergent overheads.
  • For marketing, publicity and upgrade of facilities. 

A quick business loan in Mumbai is expected to cater to every business activity. In fact, there are quick business loans in tune with emerging trends, especially from the new age Fintechs that are eminently suitable to entrepreneurs evolving in the modern business ecosystem. A formal cogent business plan and habits of prudent financial management take you close to a hassle free approval of business loan.

Financial Habits that enhances your chances for a Quick Business Loan:

Availing a loan to run a business is a fact of life. It makes sense to be sensitive to the lender’s requirements as well as adhere to prudent financial norms to reap the benefits of the credit facility. Let us see what helps:

  • Understand your business: Study well before you take the plunge. It will help you meet the challenges drawing from your strength and covering for weaknesses as the first step.
  • Understand the market:  By market analysis, you get to know potential of your product. Knowing the preferences of the target audience is an important component of market research. 
  • Understand your limits: A clear insight into your financial status is important for you to seek the right type and quantum of fund from a quick business loan
  • Understand business need: It is important to be clear in mind about what your business need is as compared to personal. Intermingling of the two is a sure recipe for disaster which may lead to loan default.  
  • Understand the risk elements: Nothing is free of risk in this world. Even when everything is rosy, a natural calamity may sink the business. It is thus prudent to have a backup plan for such an eventuality.  
  • Understand time deadlines: One of the most important habits that a business must adhere to is deadlines. Timely payment of EMIs and other bills helps create lender confidence and improve your credit score. 
  • Understand the meaning of prepayment: Paying more than the requisite EMI carries a positive impression. On the other hand, it helps you foreclose your loan. Fintechs do not charge any fee for foreclosure and thus you save on your interest burden. 
  • Understand credit hunger: It is prudent to seek a loan only under compulsion. Credit hungry business is always subject to strict scrutiny which may not be in your favor.  
  • Understand the lenders: The best way to land a suitable business loan is to gauge the pros and cons of the various available credit channels. Banks, Private lenders, and Fintechs all have their own set of norms. You will have to find the channel most suited to your need, especially those that are flexible, reliable and at the same time customer friendly. 
  • Understand loan requirements: A solid business plan should be able to guide you on the financial road map. Not only is the type and quantum of loan important, but also deciding on the time has an impact on loan approval.
  • Understand credit score: Creditworthiness is an important element of quick business loan. While banks rely heavily on CIBIL score, Fintechs look for an alternate method based on data analysis, and quality of transactions. A good credit score will also attract lower rate of interest. 
READ ALSO  The dos and don’ts of getting an Instant Personal Loan

Documentation for business loan in Mumbai:

Mumbai being the commercial capital of India; is primarily the hub of quick business loan in the country. An important aspect for a quick loan approval is the competitive credit market in the Metropolis. Fintechs are playing an important role in this scenario offering innovative products tailored to needs. 

Additionally the use of digital platform using data and design for a hassle free unsecured loan in a customer friendly environment is an attraction for borrowers. Since the application is fully online, its importance is supreme in grant of small business loan. Let us see what a correct duly filled application must have:

  • Information provided must be precise and genuine.
  • All requisite documents should be attached in digital format.
  • Proposed loan information must be complete with abundant genuine data. 

A lot depends on the data you have input in the application as Fintechs evaluate and sanction loan based on your inputs. The data and documents should be verifiable to enable the lender to process your loan proposal fast, often within 48-72 hours. Let us also check what documents are mandatory.

NatureDetails
Valid KYC documents of the promoter and the businessID proof
Address Proof
PAN card
Aadhaar card  of the Promoter
Registration and Tax returnsGST returns specified by the lender
Business Registration Certificate
Appropriate licenses and permits
Memorandum and Articles of Association 
Financial StatementITR for period specified by lender
Bank statement of Business Account

Bottom Line:

A healthy business is not only dependent on adequate finance but substantially on healthy financial habits. Proper understanding of the elements of your business is the key to prudent fund management. Your skills, determination and good habits are your strong points in approaching your lender for a suitable loan. Your credentials and your prudence are important qualities that a lender looks at critically to approve quick business loan in Mumbai. 

ABOUT

Mysuru’s favorite and largest circulated English evening daily has kept the citizens of Mysuru informed and entertained since 1978. Over the past 45 years, Star of Mysore has been the newspaper that Mysureans reach for every evening to know about the happenings in Mysuru city. The newspaper has feature rich articles and dedicated pages targeted at readers across the demographic spectrum of Mysuru city. With a readership of over 2,50,000 Star of Mysore has been the best connection between it’s readers and their leaders; between advertisers and customers; between Mysuru and Mysureans.

CONTACT

Academy News Papers Private Limited, Publishers, Star of Mysore & Mysuru Mithra, 15-C, Industrial ‘A’ Layout, Bannimantap, Mysuru-570015. Phone no. – 0821 249 6520

To advertise on Star of Mysore, email us at

Online Edition: [email protected]
Print Editon: [email protected]
For News/Press Release: [email protected]