Business Loan Advantages

Benefits of Collateral-Free Business Loans

July 25, 2022 • 6342 views

The fear and uncertainty during the days of the pandemic prevented everyone from envisioning a positive future. Despite the post-pandemic bounce back being beyond anyone's prediction or expectation, businesses, specifically the ones with limited capital and resources continued to face the brunt of the past economic turbulence.

Often the revenue is not enough to sustain all the costs and businesses have to rely on external debt options to fulfil their short-term and long-term financial needs. One such option a business owner could have is Unsecured Business Loan by Poonawalla Fincorp.  

Any loan that does not require a security deposit, collateral, or the support of a guarantor is referred to as collateral-free. To ensure that you can repay your loan on time, collateral-free Business Loans are unsecured and take into account your present income, cash flow, and business viability.

Importance of Business Loans

According to government statistics, India harbours more than 7.9 million MSMEs. The term MSME stands for micro, small and medium enterprises, a classification of businesses according to their operation scale. 

Amongst these businesses, the loan disbursal stood at around Rs.9.5 trillion (US$ 128.06 billion) for the Financial Year 2021. These stats are a testimony to the importance of loans to these businesses. If we explore the market to look at the available options, barring a few Government subsidised schemes the interest rates go as high as 26% p.a. Even the biggest banks struggle to provide competitive prices that please the consumers and are also sustainable at the same time.

As known to the public, the Indian markets are dominated by local businesses. Despite the commercial acumen and expertise of MNCs and other international goliaths, local businesses continue to be the heart and soul of our economy. We at Poonawalla Fincorp recognize this, a company built on legacy and trust, with years of experience and serving our clients with complete transparency. We are on a mission to help businesses and individuals grow with the support of our customer-centric financial products and services that have been perfected based on your feedback over the years. 

We have introduced Unsecured Business Loans to ensure that these business owners are not burdened by the extreme requirement of putting up their already limited assets as collateral against the debt. This debt scheme is also an online Business Loan allowing you to access it without any barriers making it a part of our ongoing effort to turn possibilities into reality. 

Features of Online Business Loan

Whether it's a loan to get your enterprise up and running, or to grow a pre-existing venture, whether you wish to grow your service scale and want to hire more, or it's just a short-term gap of funds that you wish to plug, a Business Loan can serve you for every purpose. 

You can get loans up to Rs. 30 Lakhs approved in no time without giving up any of your assets as collateral and can also complete the 5-part process online at your convenience. In sync with the government's policy supporting MSMEs, we have special interest rates for businesses that qualify the requirements.

According to the MSMED Act of 2006, loans are accessible for up to Rs.2 crores (Rs.1 crore for retail businesses).

Both, new and existing MSMEs are eligible for loans.

A loan with a larger loan amount is also an option. However, any payment beyond Rs.1 crore would need to be backed by collateral. Plant and equipment, real estate, or any other asset owned by the entrepreneur may be used as collateral.

Also Read :- How to Use Your First Business Loan Effectively?

Benefits of Collateral-Free Business Loans

In times of buoyant economies, traditional bank loans might be peoples' primary preference, but banks tend to tighten their lending standards in the current situation. We understand that financial requirements are often sudden, and irrespective of the economy's situation, we continue to offer Unsecured Business Loans alongside specialised services that make the process welcoming for anyone. Here are some of the benefits of collateral-free Business Loans:

No collateral is required
This is the first and foremost benefit of an Unsecured Business Loan and we cannot stress it enough. These loans do not compel you to put your priceless assets in danger to advance the company. Thus, they give you the freedom to use the loan proceeds for the company's needs without worrying about losing your assets.

Flexible loan tenures
To accommodate for the uncertainties that you might encounter during the tenure of the loan we have Flexible loan tenures of up to 36 months that help you adjust your repayment schedule according to the ups and downs of your business.

Online application process
Our firm envisions a future where we can fully harness the power of technology and be able to serve you better with a strong foundation of technology. With this objective in mind, we have designed the Business Loans of today and the future. You may apply for this line of credit from the comfort of your home. Thanks to the online application process, money gets credited to your account without any delay, saving you a tremendous amount of time. 

Quick loan approval
Customer convenience is our priority as highlighted by our online Business Loans, but we also ensure that customers can get the capital as soon as possible, with fast disbursal rates and minimum document requirements. 

We value the faith our customers put into us and to keep it intact we keep our entire process of loan procurement, from application to disbursement, completely free of any hidden charges. All the details are found on our documentation and our website while availing of the service of online Business Loans. 

The market is full of options but very few can match our USP, from being online, instant fund transfer to your account, to also allowing you to get credit without any collateral. With best-in-class service, we offer a rare combination of features that we have only been able to achieve with years of experience. Today, it is the online nature of loans and them being unsecured, tomorrow the requirements might be different, but Poonawalla Fincorp has always got you covered, and we will be there for you to provide you with financial services to ensure your business continues to grow.

FAQs

  • What is a collateral-free Business Loan?

A collateral-free Business Loan is a type of unsecured loan that does not require any asset to be provided as security against the loan amount. NBFCs like Poonawalla Fincorp offer unsecured Business Loans at attractive interest rates and flexible repayment terms.

  • What is the limit of collateral-free loans for MSMEs?

The upper limit of most collateral-free loans varies among lenders. However, some lending institutions, such as Poonawalla Fincorp, offer collateral-free MSME Loans of up to Rs.50 Lakh, with a repayment tenure of up to 36 months.

Disclaimer

We take utmost care to provide information based on internal data and reliable sources. However, this article and associated web pages provide generic information for reference purposes only. Readers must make an informed decision by reviewing the products offered and the terms and conditions. Business Loan disbursal is at the sole discretion of Poonawalla Fincorp.
*Terms and Conditions apply

poonawalla fincorp team

Poonawalla Fincorp Team

We are a team of expert writers and editors passionate about providing our readers with authentic and valuable information on finance. Our aim is to simplify financial and finance-related concepts. We strive to help our readers become more aware and empowered to make informed financial decisions.

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