Checklist for business loan application

Here is a Checklist of Documents for a Business Loan Application

March 19, 2022 • 15084 views

A Business Loan is an unsecured loan granted based on financial history, repayment capacity, and credit score. Business Loan can serve as the catalyst for growth, expansion, or overcoming unforeseen obstacles in your business. While applying for a Business Loan, you will be required to gather and submit various essential Business Loan documents to demonstrate financial stability and credibility. Here’s the business loan documents checklist that you will require when applying for a loan.

Business Loan Application Checklist

The list of all the things you need to check when applying for a Business Loan is given below:

  • Business Plan: A comprehensive document outlining business goals, strategies, and financial projections, including repayment plans, to showcase a clear understanding of the business's potential for success.
  • Financial Statements and Bank Statements: Up-to-date financial statements (balance sheet, income statement, cash flow statement) prepared by a certified accountant, along with bank statements for the last six months, to provide insights into the company's financial health and creditworthiness.
  • Tax Returns: Details of tax returns for the past three years help lenders evaluate the business's income, expenses, and overall financial performance.
  • Loan History: Lenders assess the loan history of both the business and its founders/directors. This includes past loans, repayment records, and previous loan history. This evaluation determines the business's creditworthiness and the likelihood of loan approval.
  • Business Registration Documents: Necessary legal documents, such as a certificate of incorporation, memorandum of association, and GST registration certificate, validate the business's legal status and compliance with regulations.
  • Accounts Receivable and Accounts Payable Ageing: The accounts receivable ageing report tracks customer payments, while the accounts payable ageing report gauges supplier payment efficiency. Lenders rely on these insights to assess a business's financial health and resilience, especially in credit-heavy business-to-business scenarios.
  • KYC Documents: Essential identity verification documents like Aadhar cards, PAN cards, and driver's licences establish the borrower's credibility and mitigate fraud risks.

ALSO READ :- Eligibility Criteria for MSME Loan and Required Documents to Apply

Documents Required for Business Loan

Business owners must provide the following loan documents for a Business Loan application:

1.    KYC Documents

  • Director/Proprietor/Partner: PAN Card, Aadhaar Card, Driving Licence, Voter ID, or Passport.
  • Personal Documents (All Individual/Partner/Director): PAN Card, Aadhaar Card, Driving Licence, Voter ID, or Passport, and proof of address (if not consistent with officially valid documents).

2.    Business Documents

  • Business Registration Proof.
  • Business Address Proof (if different from Business Registration Proof): Utility bills or Rent Agreement.

3.    Financial Documents: Statement of Bank Account for the last 6 months.

Step-by-Step Guide to Apply for a Business Loan

As a top financial institution in India, Poonawalla Fincorp offers the best interest rates and repayment tenures. Applying for a Business Loan is a straightforward process consisting of three simple steps:

  • Step 1: Click on the 'Apply Now'.
  • Step 2: Complete the loan application form by providing the required details accurately.
  • Step 3: Upload the necessary documents as instructed.

Upon successful verification, the loan amount will be disbursed into your designated bank account, providing you with instant access to the funds. Also, do not forget to check your CIBIL score before applying as it is an integral part of the application process. Click on the ‘Free CIBIL Score’ button and check your credit score for free.

To Conclude

Business Loan can be a great boost for your business expansion and scaling and take it to the next level. The Business Loan application checklist mentioned in this blog will help you with quick approval and instant loan disbursal. Poonawalla Fincorp offers collateral-free Business Loan with minimal documentation and quick disbursal.

Frequently Asked Questions About Business Loan Documents

1.    Does a Business Loan impact personal credit?
No, lenders usually evaluate business credit separately based on financials and history. However, some may consider personal credit for small businesses.

2.    How do I check my business’ CIBIL score?
You can check your CIBIL score for business loan by visiting the official website of the TransUnion CIBIL website and providing necessary information like business name, registration details, and contact information. After verification, you should be able to access the business’s CIBIL score.

3.    Which banks or NBFCs provide easy access to a Business Loan?
Several banks and NBFCs, including Poonawalla Fincorp, offer business loans in India. Poonawalla Fincorp provides a Business Loan of up to ?50 Lakh without collateral.

4.    What is loan restructuring?
Loan restructuring involves adjusting the terms of an existing loan agreement to offer temporary relief to borrowers facing financial challenges. This may include changes to the repayment schedule, interest rates, or even the principal amount.

5.    Can a salaried person take a Business Loan?
A salaried person cannot apply for a Business Loan as it can only be used for catering additional business requirements, whereas a Personal Loan can be used for specific Personal financial requirements.

6.    What is the turnover limit of MSMEs for a Business Loan?
With Poonawalla Fincorp’s Business Loan for MSME, the minimum annual turnover limit is ?6 Lakh.

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

Our team of expert writers and editors are passionate about providing 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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