Business Loan

A business loan is a financial funding tool for business owners to address their planned or urgent expenses. As it is an unsecured financing option, you can opt for it without allocating any security or collateral. It is also known as Instant Business Loan.

The loan amount and interest rate for business loans usually vary between ₹50,000 to ₹20 Crore and 8.25% p.a. to 25% p.a, respectively. Business loans can be availed by business entities like private limited companies, self-employed professionals and non-professionals, and partnership firms.

Features of Business Loan

  • High loan amount (Up to ₹20 Crore)
  • Collateral or security free
  • Flexible and high repayment tenure (Up to 60 years)
  • Fast processing
  • Fixed interest rate (usually ranges between 8.25% p.a. to 25% p.a.)
  • Minimum documentation and paperwork
  • Pre-approved offers are provided by lenders

Business Loan EMI Calculator

Format: 12m, 36m, 3y, 7y

Monthly Payment (EMI):

Total EMIs:

Total Payments:

Total Interest:

While deciding to take a business loan, you might have thought about a tenure period and loan amount. You might also have thought about how your monthly EMIs would look like. A business loan calculator will be helpful to you in such scenario.

Above is an online business loan calculator provided by us that contains 3 variables including interest rate, loan amount, and loan tenure. If you want to avail a business, this online calculator will be helpful to you in calculating business loan EMI.

Comparison of Business Loan

More than 20 lenders including banks, financial institutions, and credit unions offer business loans in India, and you can apply offline or online for availing a business loan. Various lenders provide a different loan amount range, tenure period, processing fees and charges, and interest rates.

Therefore, it is essential to go through business loan schemes of multiple lenders before opting one. Below is a comparison of top 10 business loan lenders of India along with required details.

Bank/NBFC Loan Amount Tenure Interest Rate Processing Fee
HDFC Bank Up to ₹50 Lakh 1-4 Years 10.00% p.a. onwards Up to 2.0% of the loan amount
IIFL Finance Up to ₹30 Lakh 1-3 Years 11.75% p.a. onwards Up to 2.4%
Axis Bank Up to ₹50 Lakh 1-5 Years 14.25% p.a. onwards Up to 2.0% of the loan amount
IDFC First Bank Up to ₹1 Crore 1-4 Years Contact the bank for this information Contact the bank for this information
Kotak Mahindra Bank Up to ₹75 Lakh 1-4 Years 16.00% p.a. onwards Up to 2.0% of the loan amount
Fullerton India Up to ₹50 Lakh 1-5 Years 17.00% p.a. onwards Up to 6.5%
Bajaj Finserv Up to ₹45 Lakh 1-5 Years 17.00% p.a. onwards Up to 2.0%
RBL Bank Up to ₹35 Lakh 1-3 Years 17.50% p.a. onwards Up to 2.5% to 3.0%
ICICI Bank Up to ₹2 Crore 1-7 Years 17.00% p.a. onwards Up to 2.0% of the loan amount
Lendingkart Finance Up to ₹2 Crore 1-3 Years 1.0% to 2.0% p.m. onwards Up to 2.0% to 3.0% of the loan amount
Tata Capital Up to ₹75 Lakh Up to 3 Years 19.00% p.a. onwards 1%-2.5% of the loan amount

Business Loan Eligibility

For opting business loans, you will need to fulfill the below mentioned business loan eligibility criteria provided by lenders:

Eligibility CriteriaRequirements
Age of applicantMin age: 21 years, Max age: 65-70 years (Age should be 70 years at the time of maturity)
CIBIL Score 685 or higher
Employment typeSelf-employed, Private Limited Company, Proprietors, Partnership Firms
Business VintageIn business for at least 3 years (profit making for the previous 2 years)
Turnover and profitMinimum turnover- INR 40lacMinimum Profit (ITR)- INR 1.5lac (per annum)

Documents required for Business Loan

The documents required for business loan disbursal are mentioned below:

  • Identity Proof: Voter ID proof/ Aadhar Card/ Passport/ Driving License/ PAN Card
  • Address Proof: Voter ID proof/ Aadhar Card/ Passport/ Driving License
  • PAN Card: Required for Company/ Individual/ Firm
  • Financial Documents: Bank Statement of previous 6 months, GST Returns, and other required documents
  • Latest ITR along with Income Computation
  • Profit & Loss Account and Balance Sheet for previous 24 months (CA Audited/Certified)
  • Continuation Proof: ITR/Trade license/Establishment/Sales Tax Certificate
  • Business Ownership Proof: Business Registration Documents
  • Other mandatory documents.

Business Loan Interest Rates and Fees

Business loan interest rate currently ranges from 8.25% p.a. to 25% p.a. but may vary depending on the terms and conditions of the lender. Business loan interest rate may vary depending on multiple factors such as age of applicant, income of applicant, credit score, type of lender, RBI policies and guidelines, current market rates, internal policies, and many more.

Therefore, it is highly recommended to go through the terms & conditions of the lenders before opting one. You can also go through different lenders providing business loans to discover the lowest business loan interest rate option available for you.

Apart from the interest rate, you must also check out various fees and charges associated with the business loan online. These charges and fees mostly include:

  • Processing fees (up to 3%)
  • Goods and service tax (GST)
  • Prepayment charges (may differ from lender to lender)
    No prepayment applicable until repayment of 6 months
    6-24 months- 4% of outstanding principle amount
    25-36 months- 3% of outstanding principle amount
    Above 36 months- 2% of outstanding principle amount
  • Late payment penalty or bounce charge for EMI (differs from lender to lender)
  • Document processing charges (differ from lender to lender)
  • Annual maintenance charges (differ from lender to lender)
  • Verification Charges (differs from lender to lender)
  • Stamp Duty and legal charges (as per applicable state laws)

Please read all T&C provided to you by your bank before availing a business loan. All supplementary fees and charges are mentioned there.