6 Scenarios where a Personal Loan is Better for Boosting your Business
Your business could have various needs for finance every now and then, be it for working capital needs or growth. However, in some scenarios, opting for a business loan may not be an option, especially if you don’t have the right documents or financial history. In such a situation, a Personal Loan can get the job done just as well. So, instead of postponing your business needs, take the help of a Personal Loan instead.
Here are the various scenarios where you could use Personal Loan to boost your business
If your business doesn’t have a credit history
If you have recently started your own business, it may not have a credit history. In such a scenario, lenders may be hesitant to sanction a business loan to you. As an alternative, you can easily apply for a loan. A Personal Loan for business can help you fulfil various financial needs, whether it is to ease cash flow problems or lease an office space. However, ensure that your personal credit score is good to maximise your chances of approval.
If you don’t have business vintage
Business vintage signifies how many years your business has been in operation. Quite often, lenders require you to have a business vintage of 3 to 5 years before you apply for a business loan. This helps lenders establish your repayment ability. If your business is new, you won’t be able to meet the relevant business vintage requirements and so, you won’t be able to apply for a business loan. In this case, a Personal Loan for business is suitable.
If you need a small loan amount
The amount that you need will also determine whether or not a Personal Loan is apt for you. If you don’t require a vast amount of finance, you can make use of a Personal Loan. With it, you can borrow up to Rs.25 lakh to meet varied needs. So, if you need funds to tide over for just a few months, for example, a Personal Loan serves as a convenient option.
If you don’t have collateral
Many lenders require you to submit collateral in some form to access a business loan. However, if you have a new business with no assets or securities to pledge, or aren’t comfortable with the idea of pledging assets, you can opt for a Personal Loan. This loan helps you raise funds instantly and is completely collateral-free.
If you need funds immediately
This kind of loan has a simple application procedure and if you qualify, you can raise funds at a moment’s notice, within just 24 hours. All you have to do is complete a simple online application procedure after which the funds are credited directly into your bank account. Hence, when you need to arrange funds at a short notice, you can rely on this option.
If you need funds for a short period
If you need funds for your business for the immediate future, a Personal Loan is an excellent option. It has a tenor of 12–60 months making it the perfect way to cater to needs such as a seasonal change in demand, or when you need an infusion of funds to buy and maintain inventory. If your cash needs are unpredictable, certain lenders allow you to avail the loan as a Flexi Hybrid Loan.
Bajaj Finserv is one such lender. Their Flexi Hybrid Personal Loan allows you to make multiple withdrawals from your total loan amount as and when you need to. It also provides you the convenience of paying interest only on the amount that you use. Besides, you have the choice to pay interest-only EMIs and repay the principal at the end of the tenor.
So, if your business is facing any of these situations, don’t let a lack of funds stop you from running it optimally. Simply turn to a Personal Loan and meet all your finance needs.