How an Unsecured Business Loan Can Help You Succeed?

Situation: You are looking for a quick loan to upgrade your establishment!

Difficulty:  Wondering what collateral to put up against the loan? Well, opt for an unsecured one instead!

An unsecured loan doesn’t require collateral or an asset to be put as a guarantee. The financial institutions providing these loans only require the applicant to hold an adequate CIBIL score and meet some basic eligibility criteria.

Several lending organisations like Bajaj Finserv offer quick unsecured business loans to businesses across the country. While a customer enjoys the privilege of using the money without restrictions, there are numerous added benefits that come along with such collateral free business loans. At affordable interest rates, these loans even come with pre-approved offers demanding minimum documentation from the borrower.

Reasons to go for an unsecured loan are diverse. Some of the most significant ones are:

• Quick approval

Loans without security can be sanctioned within a short time span owing to the quick approval processes followed by many financial bodies.

Being unsecured in nature, such loan applications do not require much time to be processed. The processes are devoid of extensive paperwork of mortgaging a property or hypothecating an asset. Now-a-days, many institutions like Bajaj Finserv approve online loan applications within 24 hours.  

• Various financing options

When applying for a secured loan, you have to specify the objective of the same. Moving away from your objective is not permissible. For example, a Home Loan will only allow deployment of funds to build a home. In this case, lenders lend money for a specific reason; to be utilised for building a home.

However, with an unsecured business loan, you can use the amount in any way you like it. Be it renting or purchasing a new warehouse, adding new furniture to your office, upgrading your computers, or anything else, the money can be used as and when required.

• Flexible loan tenors

With flexibility in loan tenors, you can get the option to plan your business budget and apply it effectively. This will also reduce changes of repayment failures as you decide your repayment terms yourself.

• Lower tax liability

If you own a small business, paying income tax can become an obligation. However, with an unsecured business loan, you can receive tax benefits for your organisation. This can help you save money which can find usage in your business, again as a reinvestment.   

• Enabling continual cash flow

An unsecured loan can come as a benefit for those businesses which require an emergency investment to ensure continuation of daily activities. If faced with unforeseen circumstances, these loans can save your business from coming to a sudden halt.

Unavailability of cash for stocking up inventory or raw materials can create obstacles in the path of advancement. Borrowing money can be of immense help while facing such a challenge.

Check for Flexibility in Repayment

While there are financial companies allowing borrowers to scale their EMI as required, Bajaj Finserv’s Flexi business loans facility allows the freedom to pay only the interest amount as EMI of the borrowed loan.

This facility allows a borrower multiple withdrawals from the loan account at no extra charges. Only the interest on the utilised amount can be paid as EMI and the principal amount is left to be settled at the end of the tenor. Moreover, if the borrower returns the withdrawn amount within the same day, even the interest amount is not charged.

With these reasons, going for an unsecured business loan can help you expand your business’ market reach. Small and medium scale industries find these benefits the most noteworthy with the advantage of easy documentation, competitive rate of interest, flexibility in repayment tenor, customised loan processing, and more.