Best Banks to get Business Loans in India

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Best Banks to get Business Loans in India

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Best Banks to get Business Loans in India

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Introduction

Acquiring a business loan in India can be a challenging task for entrepreneurs, especially if they are not aware of the best banks that offer business loans. Banks play a crucial role in the growth and expansion of businesses in India by providing them with the required funds. In this blog, we will discuss the best banks for business loans in India.

Different Types of Business Loans

  1. Business loans for startups and new businesses: Acquiring capital for a new business can be a challenge, but banks offer a reliable funding option without requiring equity dilution or sharing of profits/losses. Banks also have a systematic framework for financing requests.
  2. Business loans for bad credit: Some banks offer loans even if your credit rating is poor, but they typically require that the value of your business assets is greater than the loan needed.
  3. Business loans for women entrepreneurs: The Indian government has set up special loan schemes for women entrepreneurs, such as the Dena Shakti Scheme, Stree Shakti Scheme, and Udyogini Scheme, to support the growth of women-led businesses.
  4. Business loans for expansion or working capital: If you have a good credit score and the necessary documentation, getting a business loan for expansion or working capital is straightforward. However, it’s important to select a bank that offers the best interest rates, has no hidden charges, and charges a low processing fee.

Mandatory Documents Demanded by all Banking Institutions

Banks conduct document verification to ensure that the customers meet the business loan eligibility requirements as stated by the particular bank.

  • PAN card of the firm, company, or individual
  • Resident proof
  • Identity proof like Passport copy, Aadhar copy, Driving License, etc.
  • Business stability proof (only for self-employed individuals)
  • Current Income Tax Return, the Balance Sheet, income computation, last 2 years’ profit and loss, etc.
  • Last three-month salary slip for salaried individuals
  • Correctly filled out the application form along with passport-size images
  • Last six-month salary slip
  • Sole Proprietorship Declaration

Best Banks for Business Loans in India

1. HDFC Bank Business Loan

Eligibility Criteria

  • Minimum business turnover = Rs. 40 lakh
  • The last two years of the business should yield profit

Fee and Charges

  • Up to 2.50% + GST as applicable

2. Axis Bank Business Loan

Eligibility Criteria

  • Business experience = Minimum 3 years
  • Age group = 21-65 years

Fee and Charges

  • Up to 2% + GST as applicable

3. ICICI Bank Business Loan

Eligible Parties

  • Age group = 28-65 years
  • Turnover = Rs. 40 LPA for non-professionals and 15 LPA for professionals
  • Tax return = Last 1 year
  • Bank statement = Last six months

Fee and Charges

  • Up to 2% + GST as applicable

4. Kotak Bank Business Loan

Eligibility Criteria

  • Business turnover = Minimum Rs. 40 Lakhs
  • Age = 25-65 years
  • Business should yield profit for a minimum 1 year
  • Business category = Manufacturing, service provider, or trader

Fee and Charges

  • Up to 3% + GST as applicable

5. IDFC First Bank Business Loan

Eligibility

  • Business Existence = Minimum 3 years
  • Sole proprietorship firms, partnership firms, and self-employed individuals can apply

Fee and Charges

  • 1.5% + GST as applicable

6. SBI Business Loan

Eligible Parties

  • Business Existence = Minimum 5 years
  • Minimum existence of current account = 2 years
  • Minimum average monthly balance = Rs. 1 lakh

Fee and Charges

  • 2-3% + GST as applicable

7. Citibank Business Loan

Eligible Parties

  • Age group = 21-65 years
  • Business category = Manufacturing, service provider, or trader
  • Minimum existence of business = 3 years

Fee and Charges

  • Up to 2% + GST as applicable

8. Bajaj Finserv Loan

Eligible Parties

  • Business existence = Minimum 3 years

Fee and Charges

  • Up to 2% + GST as applicable

9. IndusInd Bank

Eligible Parties

  • Minimum turnover = Rs. 1 crore
  • Profitability = Last 3 years
  • Capital = More than 10 lakh

Fee and Charges

  • 0.5% + GST as applicable

10. Tata Capital

Eligible Parties

  • CIBIL score= Above 700
  • Age limit= 21-65 years
  • Profitability = Last 3 years

Fee and Charges

  • 1.50% -2.50% + GST as applicable

11. Standard Chartered

Eligible Parties

  • A sole proprietor or a partnership firm
  • Age group = 21-60 years
  • Applicant’s minimum income = Rs 18000

Fee and Charges

  • Up to 2% + GST as applicable

Also Read: Need of Automation in Accounting and Bookkeeping for StartUp’s

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