Adopt These 5 Effective Ways To Repay Your Small Business Loan


Availing of a small business loan in India can stabilise your business and take you out of a financial crunch. It can be a great financial source when you plan to grow and expand your business and reach new horizons. However, you can get its benefits and use it as a tool to improve your creditworthiness only if you stay consistent with its repayments.

By adopting these effective ways to repay your small business loan, you can pay it off easily and at the same time realise your business goals.

Why Repaying Your Business Loan is Crucial?

Repaying your business loan punctually can help you improve your credit rating, based on which your future lenders would make decisions regarding your loan approvals, loan amount, and interest rates. Besides that, timely loan payment helps you build a strong relationship with your lender and enhance your chances of getting more loans in the future with favourable terms and conditions.

Timely repayment of loans helps create your brand and grow your business while building a good reputation among lenders. Finally, you gain more confidence to expand your business successfully. Your mind remains stress-free so that you can think more clearly and design a hassle-free business growth model.

Effective Ways to Repay Your Business Loan

These are some of the best tips to repay your business loan on time:

1. Create a Plan

As soon as you think of applying for a business loan, you should begin creating a plan for its repayment. Don’t wait to create a plan until you miss a few EMI payments. Make a plan right from the beginning and be consistent with its repayments.

First, you must be clear about what you want to do with the business loan amount and then apply for a business loan. Whether you want to upgrade equipment, buy inventory, hire employees, or build working capital with your business loan amount, create a plan, evaluate your needs, and apply for a loan amount that you can repay conveniently according to your repayment capacity.

2. Reduce Cost

When you plan to apply for a business loan and use it for your intended goals, it is crucial to understand where you are overspending so that you can control them. Study your past few months’ account statements, where you are spending unnecessarily, and control those expenses to create a robust repayment plan. Plan your revenue and expenses to ensure that you repay your EMIs periodically. When you plan your expenses, think about ways to reduce your unnecessary expenses.

For instance, marketing your business is necessary, but you need to handle your campaign while making the best use of the available resources. Start with free or cheap mediums of marketing until you attract some customers and increase revenue.
Find more ways to reduce your overhead costs, avoid lavish expenses for the time being, and prioritise your loan repayment over others.

3. Improve Collections

Besides cutting costs, you must also focus on increasing your sales and collections. Find ways to attract customers, give them promotional offers according to your budget, and generate sales to increase revenue. Ensure good quality of your products or services and provide optimum customer service to your customers to spread word of mouth. Contact your clients for due payments to increase your revenue and get the ball moving.

Also Read: A – Z of Business Loans for First-Time Loan Applicants

4. Understand the Loan Terms

You might have an excellent plan to repay your business loan amount. However, you may face shocks if you do not understand your loan terms properly. To understand these terms, discuss them with your lender, ask if you are unclear about anything, and read the fine prints without accepting the loan offer. Know what your loan repayment date will be, the penalty clause, and how much you need to pay as interest.

The interest rate applicable to your business loan in India will depend on various factors, including your loan amount, interest rates, repayment tenure, credit score, and others.

Remember, the longer term you select, the higher interest amount you will pay. However, shorter loan tenure may make your EMIs heavier, but it will help you save a lot on interest outgo. Use a business loan EMI calculator to get an estimate of your EMIs and select a loan term according to your budget and repayment capacity.

Also, find ways to reduce interest rates when you apply for business loan. Now, you can plan your business loan repayment according to your budget and loan terms.

5. Select Your Loan Tenure Wisely

When you think about loan repayment, some lenders give you the freedom to choose your loan tenure according to your repayment capacity. For instance, at Clix Capital offers a flexible repayment term of 12 to 36 months that you can choose as per your repayment capacity. The longer tenure you choose, the smaller will be your EMIs but higher will be the interest outgo. On the other hand, if you choose a shorter loan tenure, your EMIs will be higher but you will save a significant amount on the interest outgo.


You can easily repay your business loan if you adopt these five effective ways to make repayment easier. Regular repayment helps you create a good relationship with your lender and opens doors to more credit for future endeavors. At Clix Capital, we provide financial support to help your small business flourish.

We offer small business loans of up to ₹ 50 lakhs with 12 to 36 months of repayment tenure. So, apply now and take advantage of our easy eligibility conditions to avail your business loan within minutes. Now, money will no longer be a constraint for expanding your business according to your aspirations.

For any queries, find us on Facebook, Instagram, LinkedIn, Twitter, or WhatsApp. You can also reach us at or call us at +91-120-6465400.T&C Apply*.

Also Read: How Can A Small Business Loan Help Your Business Growth?

February 5, 2023 Business Loan 821

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About Author


Aparna Bihany, Head of Unsecured Loans at Clix Capital, has 18+ years of strong experience across credit, underwriting, products, and business for SME loans and financing.