Business Loan: Eligibility Criteria & Documents Required
While running a business, there is a constant need for funds to meet various expenses. Whether it’s on raw materials, increasing production, going into marketing or for expansion: business walks only when money talks.
Running a business is a uniquely enriching experience, but facing financial shortfalls not so much. In the face of a cash crunch, businesses can either scale down or cut back operations, or business owners can dive deep into their personal wealth to resolve matters: both scenarios are far from ideal. This may sound like a Catch 22 situation, but Business Loans from us are indeed a viable solution to such scenarios.
Businesses of all sizes can fulfil pressing and important financial responsibilities relating to business operations and other obligations through this safe and effective solution, and ensure their operations don’t take a hit.
Before applying for a Business Loan from Clix Capital, you should make sure your Business Loan eligibility sits right with our basic requirements. For this, you must also ensure you have all the documents required for a Business Loan at the ready.
Here are some benefits you get when you take Business Loans from Clix Capital:
- Large loan amounts: You can apply for and avail Business Loans from Rs 5 Lakhs to Rs 50 Lakhs. Our algorithm based procedures offer faster loan processing , and if your credentials are kosher, your Business Loan application will be accepted in a little more time than the speed of sound: even if the loan amount is high.
- Collateral-free loans: You can get Business Loans without putting up security or collateral (yeah, you read that right). Our offerings are ideal for small business owners who do not own assets, and even for those who don’t want to present any as collateral.
- Flexible repayments: Your Business Loan repayment, your money, your tenure: your choice. Clix Capital offers customisable repayment modes and tenures for its customers who take Business Loans.
- Minimal documentation: We’re all about that minimalist life, and so are the Business Loans we offer: they need minimal documentation for approval. You can check out our website for the Business Loan documents list before applying, sort them out, and get speedy approval.
Eligibility Criteria for Business Loans
Who can take a Business Loan?
- Private Limited Companies: Owners of Private Limited companies can get Business Loans from Clix Capital. This means companies that are not yet listed on the stock exchange are free to apply for a Business Loan to meet financial obligations related to their business. There are numerous uses Business Loans can serve: creating new products, expansion, acquisition, building a better team of workers, marketing, remunerating existing employees, etc.
- Proprietorship Firms: Sole proprietorships are companies managed and owned by individuals. These companies do not have any partners, and the profit goes solely to the one true king or queen: the owner. Sometimes you can’t make it on your own(er), and in case capital runs out, help is always here for those who ask. Business Loans can be used for the purchase of raw materials, marketing, operations, logistics, etc. Check out our Business Loan eligibility criteria to learn more.
Other Eligibility Criteria for Business Loan
If you don’t want to waste data and visit another page, here’s the basic Business Loan eligibility criteria for applicants:
- Age limit: 21 years to 65 years
- Minimum turnover: INR 1 Crore
- Age of business: At least 3 years old
- Credit score: 700 or above
- Business CMR (CIBIL MSME Rank): not more than 6
- Nationality: Must be an Indian national
Documents Required for Applying for Business Loan
When you can readily present the following documents, getting a Business Loan will become much quicker and easier:
- Proof of identity: You can submit an Aadhar Card, PAN Card or Voter’s ID Card.
- Proof of address: You can submit your electricity bill, water bill or Aadhar Card.
- Proof of ownership: You should have the following documents to prove your business ownership: Most recent IT returns | P&L statement of past two years | Proof of continuity of business for the past 3 years | GSTIN | 6 months’ bank statement | PAN card
Important Factors that Determine Business Loan Eligibility
Apart from meeting the requirements for small and big business loans, some other factors determine your eligibility. They are:
- Credit score: Your credit score indicates your financial history concerning past loans and payments. As the theory of evolution deems, applicants with high credit scores are preferred over those with low credit scores.
- Business turnover: The minimum limit for a turnover must be met by all applicants to avail a Business Loan.
- Stability: Unlike a castle of cards in a sandstorm, your business must have stability and render a steady cash flow to avail a Business Loan.
- Market conditions: The market conditions (and not the human condition), backed by the country’s economic stability, can influence your eligibility for a Business Loan, namely the Business Loan interest rates.
Tips to Increase Your Business Loan Eligibility
Here are some free for all tips to improve Business Loan eligibility.
- Healthy Credit Score: Maintain a healthy credit score to get Business Loans at low-interest rates. To do so, keep checking your past loan payments and avoid repeating or missing installments on existing loans.
- CMR Score: CIBIL MSME Rank or CMR is a grade assigned to the MSME based on its credit profile, credit behaviour and firmographics. It ranges from 1 to 10, 1 being the least risky and 10 being the riskiest.
- Proper Documents: It is important to be proper, and also maintain proper documentation of all your business operations when applying for a Business Loan.
- Business Stability: If your business has a stable turnover and steady income, your loan eligibility will increase.
- Clarity About Financial Needs: You must know your business’s financial needs before applying for a Business Loan. At the time of loan application, your business’s financial needs must be justifiable and feasible to the lending institution.
How Do I Apply for a Business Loan from Clix Capital?
Call us, or follow the steps below and apply for a Business Loan with Clix.
- Go to the Clix Capital website (you’re already here tbf)
- Go to the Business Loan page
- Enter your phone number and click ‘Apply Now’
- Fill out your name, email, pin code and the amount required
- Submit the details along with the OTP received
- You will get a call from the Clix representative for further proceedings.
What Documents Do I Need To Provide
We’re almost paperless (yes, really) but will need a few document to process your application:
Completed Application Form
- We will provide you with a run-of-the-mill application form to detail out all the information we need before processing your business loan request.
Passport-Size Photograph
- This photograph should be fairly recent and indicative of your current physical appearance.
Identity (ID) Proof
- This can be either your Aadhaar Card, PAN Card, or Government ID (if you happen to be a government employee).
Address Proof
- Your Aadhaar Card is the go-to document here. In case your current address is not updated in Aadhaar card, one certified copy of any Official Valid Document (OVD) is required. These OVDs are either your Passport, Voter ID, or Driving License. Your Utility Bills from the last 2 months may also apply here.
Financial Documents
- PAN Card – For Firm/Company/Individual(s) coming applying for the loan
- GSTIN
- 6-month bank statement
- Copy of the most recent Income Tax Return form along with computation of income, audited balance sheet and profit & loss account for the previous 2 years
- Proof of continuity of business of 3 years (ITR/trade license/establishment/sales tax certificate)
Proof Of Ownership
- In The Name Of The Applicant Or The Applicant’s Spouse/Parent
How Do I Apply For A Business Loan
Fill out
the application form.
It takes only 3
minutes!
Sit back and
relax! You are on
your way to secure a
business loan.
FAQs for Business Loan Eligibility and Criteria
What is the eligibility criteria for a Business Loan?
Applying for any Business Loan comes with a certain set of eligibility requirements. Your application will also depend on the amount of money you wish to borrow and certain circumstances at the time of borrowing. Here is the basic criteria, however, followed at Clix Capital:
- Age limit: 21 years to 65 years
- Business vintage: minimum 3 years
- CIBIL credit score: 700 or above
- CMR Score: Up to 6
- Nationality: Indian
- Turnover: INR 1 Crore and above
- Applicants can be Sole Proprietorships, MSMEs, Partnership Firms, and Private Limited Companies, etc.
- Reporting audited financial statements for the last 24 months, routing the majority of the business through a banking system, or capturing your turnover in the last 12 months through GST returns.
What is the minimum turnover required to apply for a Business Loan?
We have predetermined turnover requirements regarding the minimum turnover for applying for a Business Loan. This makes our relationship with our partners hassle-free (unlike other relations) as repayments become manageable for them. As per standard practice, we require a set amount of turnover before processing a Business Loan.
For MSMEs, this amount is set at a minimum of 1 Crore per annum or anything above that. However, this limit may vary depending on the amount an applicant applies for.
How long do you need to be in business to get a business loan?
To apply for a Business Loan, there are certain things you need to keep in mind. One of them is the time you’ve been in business- we require at least 3 years for our borrowers to be in business. This is to ensure the stability and continuity of the business.
How does your turnover affect your Business Loan eligibility?
Business turnover is an essential requirement when applying for a Business Loan. This gives us a fair idea about a business’s ability to honour your repayment obligations.
A borrower whose business meets the requirement for the minimum turnover limit set is eligible for our Business Loan. Even with a lower turnover, never say never again when it comes to Clix: reach out, and we’ll see what we can work out.
Naturally, a business looking for a higher loan amount must also have a high turnover. It’s best you ensure your business meets all criteria before applying for a Business Loan.
What are the different fees charged for a Business Loan?
At the time of loan application, the borrower must not only be self-aware but also be aware of the different fees and charges attached to the Business Loan, this includes:
- Processing fee: This is the basic fee charged to process your loan application and release your funds. It is different for each type of loan.
- Foreclosure charges: When you choose to close your loan before the tenure ends, you have to pay pre-set foreclosure charges.
- Document processing charges: These are the charges to process your submitted documents at the time of loan application.
- Late payment charges: When you fail to pay your EMIs on time, you have to pay late payment charges.
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