A crucial aspect for a smooth running of business operations is timely financial assistance. This factor acquires predominance in a small business which lacks considerable cash buffer to overcome a short-term liquidity crunch. The best option to grow the business is to avail quick business loans.
Fintech lenders make extensive use of the latest technology platforms to disburse online business loans.
Besides small business loans are available for a variety of business growth purposes: the expansion of existing business, extension into new business locations, entry into new business lines.
SMEs have their own growth challenges when it comes to obtaining quick business loans. Most banks stipulate strict conditions to avail a small business loan, which makes financing difficult for SMEs. Further, the loan approval process is long drawn and time-consuming in case of banks. NBFCs, on the other hand, have relatively relaxed criteria to access business finance and the online technology platforms enable speeding up the loan disbursal process.
Quick business loans, provided by non-banking finance companies, are short term, unsecured loans extended to SMEs with speedy loan sanction, zero collateral requirement and considerable flexibility in the interest rates and payment period. The Fintech companies offer tailor-made loans to suit the business needs of the SMEs. We shall now study how one can avail a quick business loan:
- Online application: Business owners have instant access to credit, which can be utilized for business purposes. The Fintech lenders have considerably simplified the business loan application process by utilizing secure technology platforms and business analytics. The loan may be applied for via the online website portal or mobile application. Alternatively, one can approach any of the partner networks to access credit finance. Fintech companies are able to disburse business loans within 3-5 days. The loan applicant would have to mention the following details:
- Legal structure: The lender would require details about the operating structure of the business, whether proprietorship concern, partnership firm, private limited or public limited company
- Turnover data: Generally, NBFCs mandate a requirement of over Rs 40 lakhs turnover
- Monthly payment limit: The business loan applicant must mention the monthly repayment capability of the business enterprise towards servicing the business loan
- Digital process: Fintech companies have facilitated the business loan application and approval process to be conducted online, without the hassles of extensive paperwork and cumbersome documentation. The process involved is as follows:
- ID tracking: The applicant is provided a unique ID, whereby one can track the status of the loan application process.
- Direct Credit to the bank account: Post-approval, the loan amount is directly credited into the registered bank account.
- E-signature: Further, there is a provision to digitally sign the loan agreement papers, which are sent to the email of the applicant and the verification is completed by an AADHAR based OTP sent to one’s registered mobile number.
The benefits of an unsecured business loan are immense to an SME. Especially the online process has done away with the requirement to physically visit the office premises of the lender.