Business Loan at a glance
- What it is
- A business loan is credit extended to a business – secured or unsecured – to fund expansion, inventory, equipment, marketing or day-to-day operations.
- Who it is for
- Proprietors, partnerships, LLPs and private limited companies with a trading history and verifiable financials.
- How Early Grow helps
- We review your financials and requirement, identify lenders whose criteria you meet, and help you assemble the business, banking and tax documents lenders ask for.
- Next step
- Book a free consultation or call +91 93541 57455.
Business loans: options and how lenders decide
A business loan gives a proprietorship, partnership, LLP or company funds for growth or operations: expansion, stock, equipment, marketing or day-to-day expenses. It can be unsecured, based on your turnover, cash flow and credit history, or secured against property, equipment or other assets. Secured loans usually allow higher amounts and lower rates. Unsecured loans are quicker but cost more.
Early Grow is not a lender. We help you choose the right type of finance, prepare your financials and approach partner banks and NBFCs whose criteria fit your business.
Types of business finance
- Unsecured term loan – a fixed amount repaid in EMIs, based on your turnover and credit history. See how unsecured business loans work.
- Secured term loan – backed by property or other assets, for larger amounts and longer tenures. See loan against property.
- Working capital limits – cash credit, overdraft or invoice discounting for the operating cycle. See working capital loans.
- Equipment finance – loans secured on the machinery or equipment being bought. See equipment finance.
- MSME schemes – guarantee-backed and priority-sector lending for Udyam-registered enterprises. See MSME loans.
What lenders usually look at
- How long the business has been operating, and its turnover trend.
- Profitability, as shown in ITRs and financial statements.
- Banking conduct: account turnover, balances and any cheque or EMI bounces.
- The credit history of the business and its promoters.
- Existing debt and repayment obligations.
- GST filing record, where applicable.
Minimum vintage, turnover and credit score requirements differ from lender to lender. Newer businesses generally have fewer options.
Documents usually required
- KYC of the business and its promoters or partners.
- Business registration, such as GST, Udyam, a partnership deed or incorporation documents.
- Bank statements, usually for 6–12 months.
- ITRs and financial statements, usually for the last 1–3 years.
- GST returns, if registered.
- Details of existing loans.
How Early Grow helps
- Requirement review – we look at how much you need, what it is for, and how it will be repaid.
- Profile assessment – we check your financials and banking against typical lender criteria and point out any gaps before you apply.
- Lender shortlist – we select partner lenders that suit your profile, so you avoid unnecessary credit enquiries.
- Application support – we help you prepare the documents and handle lender queries until the lender decides.
Before you accept an offer
- Compare the annual percentage rate (APR) and all charges in the lender’s Key Fact Statement, not just the headline rate.
- Check the prepayment and foreclosure terms, and any conditions attached to the sanction.
- Borrow in line with your cash flow. EMIs that stretch your working capital can hurt the business.
Official references
Frequently asked questions
Unsecured and secured term loans, working capital limits, equipment finance, loans against property and MSME-scheme loans from partner banks and NBFCs. The right option depends on the amount, the purpose and your business profile.
Proprietorships, partnerships, LLPs and companies with a verifiable operating history and financial records. Each lender sets its own minimum business vintage, turnover and credit score.
Usually KYC, business registration, bank statements, ITRs and financial statements, GST returns if applicable, and details of existing loans. Lenders may ask for more depending on the amount.
Not always. Unsecured business loans are available to businesses with sufficient turnover and a good credit history. Larger amounts often need security, and eligible micro and small enterprises may get collateral-free loans backed by the CGTMSE credit guarantee, subject to the lender.
It depends on the lender, the loan type and how complete your documents are. Unsecured loans are generally faster than secured loans, which need property valuation and legal checks.
Interest on money borrowed for business purposes is generally an allowable business expense under income-tax law. Confirm how it applies to you with your chartered accountant.
Options are more limited for businesses without an operating track record. They may include loans backed by government schemes, secured loans or personal credit of the promoters. We can explain which options are realistic for your stage.
Talk to an Early Grow adviser
Tell us what you need and we will explain your options, the documents required and the next steps. The first consultation is free.