Business Loan for Self-employed

Get a Hassle-Free Business Loan for Self-Employed Individuals

July 26, 2022 • 9607 views

The scope of self-employment and entrepreneurial skills have widened in India, especially post the pandemic. With perks like time flexibility, complete ownership, freedom and exposure, the rate of self-employment is on a rise. However, self-employment comes with a lot of demands and challenges. Whether it’s an initial investment or unstable monthly income, if not planned properly it can significantly impact the business growth.

No matter if you are a doctor who has set up his/her clinic, a self-employed financial professional, or a budding entrepreneur, the irregularities in the income can prove troublesome at times. Expenses like working capital, rent, support staff, back-office functions, IT, and info services sometimes add up to huge burdens. So, to deal with these financial hiccups, Business Loans have become an essential tool for the modern businessperson. Being able to take a Business Loan for self-employed offers you support and allows you to continue conducting business when you have a momentary cash shortage. It helps you fulfil all your business expenses and set up your business with ease.

Types of Business Loans for Self-Employed

There are different types of Business Loans for self-employed individuals available in India, and it is essential to pick one that is best suited to your preference. The type of Business Loan that is appropriate for you can depend on several factors, including your qualification requirements, the purpose of the loan, and the loan conditions you want. Some of them include:

1.    Working Capital Loan
2.    Term Loan (Short & Long-term Loan)
3.    Letter of Credit
4.    Bill/Invoice Discounting
5.    Overdraft Facility
6.    Equipment Finance or Machinery Loan
7.    Loans under Govt. schemes
8.    POS Loans or Merchant Cash Advance

How to get a Business Loan if you are a Self-Employed Individual

Self-employed people may experience a more difficult loan application procedure because they are typically held to the same lending requirements as more officially established corporations. An entrepreneur's personal assets may be at stake if their business is sued or has financial difficulties because there is no legal distinction between a self-employed business owner and the business itself. This is where Poonawalla Fincorp comes in to ease your worries. 

The Poonawalla Fincorp Business Loan is made to fit your hectic schedule and way of life. We provide quick loans online so you can always get the hassle-free money you need for your business. An applicant can apply for an online Hassle-free Business Loan by just following the below-mentioned steps:

  • Go to the application form and fill in the details.
  • Provide your KYC and income documents.
  • The application is then processed for loan verification
  • Get your loan approval in quick TAT

And that’s a wrap with the loan amount being credited to your bank account. For instant approval, disbursal and collateral-free Business Loan for the self-employed, you can visit Poonawalla Fincorp. 

While we make sure to make the loan disbursal process as easy as possible, here are a few factors you should be aware of:

Credit History or CIBIL Score

Credit rating is an evaluation of the credit worthiness of a debtor, especially a business (company) or a government. It is done by a credit rating agency such as CRISIL and ICRA on the debtor’s ability to repay the loan amount. Credit rating is directly proportional to the disbursal amount that can be raised for the business. One of the most crucial considerations made while disbursing is the company's credit worthiness.

-    If you had availed of a loan before and repaid it on time, your CIBIL score will grow stronger, while any delays in repayment will bring it down. 

-    To be eligible for a Business Loan for self-employed, you should typically score 750 or above.

-    Your personal credit score will serve as your business credit score if you operate a sole proprietorship. There is no distinction between the business and the proprietor in this type of business.

-    If you run a partnership business, it is pretty much the same as a sole proprietorship where your personal credit score will be counted. Although forms of business like a limited liability partnership ensure partners are liable for only a certain extent of the debt. Lenders often want to know the personal credit details of all the partners involved in the business.

Cash Flow Status

Every lender aims to lend money to successful businesses since doing so enhances the likelihood that the loans will be repaid on time. The performance of your company is assessed using a variety of tools, such as your balance sheet, bank records, and tax filings. Your ability to obtain a Business Loan will suffer if the balance sheet of your company indicates insufficient annual revenues.

Business Age

A business that has been in operation for less than two years typically finds it difficult to obtain business financing. While companies that have been in business for a while can provide proof of their financial stability in the form of balance sheets, bank statements, and ITRs.


To lessen the risk involved with giving company loans, the majority of lenders request collateral. If you can offer collateral to avail of a Business Loan, it will significantly increase your eligibility to get one. It is noteworthy that Poonawalla Fincorp offers collateral-free Business Loans for self-employed individuals who cannot provide collateral. We offer both MSME loans and SME loans up to ?30 lakhs.

With advancements in the banking sector and the growth of businesses in India, Online Hassle-free Business Loans have become customers’ first choice. A Business Loan can be a great source of capital for the growth of your venture, but it can also be a path to ruin if you do not plan certain aspects with care. Due to the shorter payback terms of SME loans, requesting a loan amount that is too high may increase your EMI. Servicing the loan can become challenging and result in a debt build-up if your company experiences a period of poor sales or if your invoices are late. Therefore, you should think about the above things before requesting a self-employed Business Loan.


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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