The Business Loan Checklist: Get Prepared for Approval

Business Loan checklist

Have you been thinking about getting a business expansion loan to grow your venture? We must say, don’t think twice—just do it! Vyapar loans grant you the purchasing power to upgrade your equipment, hire new employees, increase marketing efforts, and much more.

Now, if you are wondering, “What is the guarantee that my instant business loan online application will be approved?”, we are glad you asked! Follow our trusted business loan checklist guide below, and you will surely get it.

Chapter 1: Loan purpose & amount

When you decide to get a personal business loan, the first big step is figuring out the logistics. You must tackle two big questions: How do you plan to use the funds? How much loan would you need? 

Let’s understand better through Vishal’s example. About three years ago, Vishal began selling graphic tees on social media alongside his full-time job. The response was phenomenal, prompting him to quit and start his own successful T-shirt company. But he needed funds, and a small business loan seemed the most viable option. 

How did Vishal decide to use the funds? He mainly needed it for hiring 2-3 design interns, website development, domain registration, business registration, collateral designing, product photoshoots, and digital marketing. 

How much capital did Vishal need? After calculating all costs, he needed a loan of around five lakh rupees.

Chapter 2: Credit score 

Your credit score is a mirror reflecting your financial capabilities. A good credit score of 750 and above shows you are responsible towards your borrowed funds. It is especially beneficial when you want a business loan in India as it improves your chances of loan approval and guarantees a better interest rate on loans. 

When Vishal learnt about this, he took many steps to improve his credit score: 

  • He got himself a credit card to maintain his credit history. 
  • He eliminated late payments by setting reminders and auto-deductions whenever possible.
  • He started tracking his CIBIL report for errors.
  • His credit use never crossed more than 30% of his credit limit. 
  • He stopped closing old bank accounts and credit cards to preserve his credit history.

Chapter 3: Documentation

Another crucial component of the business loan checklist is documentation. You need six documents when applying for a small business loan, including proof of identity, proof of address, the last six months’ bank statement, proof of business existence, and proof of property ownership. 

Vishal collected all the documents, scanned them, and stored them in a digital folder to streamline the instant business loan online application process. 

Chapter 4: Repay ability

Using the Vyapar Loan EMI Calculator, you must determine what repayment tenure would be the most comfortable for you. To do that, you must consider your cash flow projections. 

On average, Vishal sold about 160 tees priced at ₹500 each monthly. His monthly business revenue was around ₹80,000, of which around 50% or 40,000 was his profit. 

If he got a personal business loan of ₹5,00,000 at an interest rate of 23% per annum for four years, he would have to shell out about ₹16,000 per month for loan repayment, which was possible for him, considering his cash flow was nearly five times that.

Chapter 5: Application process

Finally, you must review all the terms and conditions of the small business loan and prepare for the application process. 

Vishal followed these easy application steps illustrated on the Manba Finance website: Visited the Manba Finance Website> Filled out the online application form > Got loan approved > Submitted documents > Got loan within three days.

Do you need a business loan in India? Manba Finance is the solution!

Manba Finance believes in empowering budding entrepreneurs and small business owners to help them grow and contribute to the nation’s economy. If you need more clarity on the business loan checklist before you hit the ‘Apply’ button, we will gladly help! Call us, chat on WhatsApp, or leave a message through our website.

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