Small and Medium-sized Enterprises (SMEs) often rely on debt to finance their business. This can be to take care of day-to-day operations or even for the purpose of growth and expansion. But no matter the requirement, SMEs need business finance at some point. In this article, let’s discuss the many advantages of taking an unsecured business loan to fund your small business.
- No collateral required
When you apply for an unsecured business loan, you don’t have to worry about putting up your family home or personal assets as collateral. In case of a secured loan, the lending institution can seize your assets in case you default on the loan. But you don’t have to worry about this problem with an unsecured loan. Whatever happens to your business, you can be assured that your family assets are not at risk.
- High-value loans
Previously, borrowers could not avail high-value loans without putting up collateral. But these days, you can gain access to high loan amounts with unsecured business loans. For instance, Bajaj Finserv offers machinery and equipment loans up to Rs. 30 lakh to help you finance the replacement of faulty machinery or upgradation to better equipment. With a low machinery loan interest rate Bajaj Finserv allows borrowers to meet different financial needs in the short term to long term requirements in an affordable way.
- Relaxed requirements
Unsecured business loans are designed such that borrowers can avail them easily. Most lenders offer unsecured loans to business owners if they meet certain simple eligibility criteria. For example, if you want to take a business loan from Bajaj Finserv, you need to meet the following eligibility criteria:
- Be between the age of 25-55
- Your business should be at least three years old
- Your business should have filed Income Tax returns for at least the past one year
- Focus on flexibility
When it comes to flexibility and ease of repayment, unsecured business loans score high. You get to choose the loan tenor based on your repayment capabilities. For example, Bajaj Finserv allows borrowers to choose a loan tenor anywhere between 12 months to 60 months. This gives you the freedom to service your loan based on cash flows.
In addition to this, Bajaj Finserv offers a flexi loan facility where you only pay the interest as the EMI. You can repay the principal amount as per your convenience within the limits of the loan tenor. This clearly indicates a great degree of flexibility for borrowers of unsecured business loans.
- Fast approval process
The approval process for a secured loan can take time because the lending institution needs to assess the collateral. However, there is no such time-taking process in the case of unsecured loans. There is no need to fill out extensive paperwork and wait for weeks before your loan is processed. Here, the process is fast and efficient. In fact, Bajaj Finserv processes and approves SME Finance in less than 24 hours. With pre-approved offers, you can get your loan application approved in an instant.
Unsecured business loans are an ideal financial solution for business owners in need of a cash injection and want to propel business growth and expansion. And all this comes without the need to put your personal assets and property at risk.