professional loan uses

Pros And Cons Of Personal Loan Prepayment In India

June 27, 2022 • 178 views

As a working professional, you will have set targets and expansion plans for your business. Every business owner wants to see their business grow, have more clients, and expand their business operations. All these requirements require financial aid. Sadly, in most cases, this financial constraint stands as the hurdle to such betterment of your professional life. Professional Loans are offered to professionals like Doctors, Chartered Accountants, Writers, Management Consultants, Photographers, etc., to expand their professional practice.

When you are a professional, you naturally tend to possess the skills and expertise required to run your business enterprise. All that you need is funds to excel and expand your professional services. You can apply these loans to get additional working capital, buy new equipment for your business, install software, buy or set up a new office, or for marketing purposes. These loans came into existence to cater to the needs of working professionals to excel and grow in their field of profession.

Benefits of choosing a Professional Loan?

The loans offered to working professionals of an industry for the betterment, expansion, and growth of their business are called Professional Loans.

  • A businessperson can acquire a Professional Loan of up to Rs 2 crores.
  • Most loans do not require collateral security. It enables professionals to concentrate on business growth worry-free.
  • You can repay them within five years.
  • The interest rate and applicable loan amount depend on the nature of the profession. Loans for medical professionals are considerably available at low-interest rates and benefit them well.
  • Lenders offer multiple choices for repayment of the loan, like post-dated cheques, EMIs, and ECS mandates.
  • Loan providers offer provisions for utilizing the loan amount for business-travel-related expenses like seminar fees, airfare, accommodation expenses, etc.
  • A professional can choose to have the loan disbursed to his account or even directly to the suppliers' accounts.

When should you opt for a Professional Loan?

Whether you are a newly established entrepreneur or have been in the market for quite some time, funds for the efficient running or expansion of the business are essential. Of course, one can choose to acquire money from the investors or fund it from savings, but a Professional Loan is an easy way to tackle your financial needs. However, borrowing money for business comes with a responsibility, and one must be discrete and mindful of when to opt for such a loan.

Opening a new office

The main reason to choose a Professional Loan is to enhance that professional setup for your business. When you started as an amateur in your career, you might have started small with limited funds and a small office setup. You can choose a loan to expand your business by purchasing real estate. When your business and clients grow, you can get a better formal office. For a new office and its setup, one requires enormous sums of capital investment made feasible by these loans.

Buying new equipment

The success of any industry is staying updated with the advancements. To run a successful professional service in the market, you must have the latest and advanced technological equipment. It may be a piece of new machinery, medical equipment, or even a new software in the IT industry. Loans for medical professionals are mainly for purchasing new medical equipment for their clinical requirements. New cutting-edge technology in the business can make operations more accessible, reduce time wastage and provide better results.

Increase working capital

Working capital is the lifeblood of any business organization. Without working capital, a business cannot run its day-to-day operations and go forward in the market. In the case of medium and small-scale enterprises, the main reason for unsustainability in the market is a lack of funds. Hence, they can choose a Professional Loan to meet such financial demands. Increasing the business's working capital will pave the way for better and broader operational activities that will benefit the company.

To improve the skills

To be a successful professional, one must stay up to date with the market standards. It will ensure that your business will excel and succeed in the market. In today's era of cut-throat competition, there are so many business needs that you have to meet to stay ahead in the game. Professional courses can be expensive, and there may be cases where you need to train yourself or provide such training to your employees. These courses may be heavy on your pockets, and you may need a loan for support.

Who is eligible for a Professional Loan?

  • People between the ages of 18-65 years are eligible to apply for a Professional Loan.
  • Professionals can also apply for such loans per the licenses issued by the state or central governments.
  • Individuals certified or graduated with a professional degree are qualified to apply for this loan—for example, engineers, lawyers, chartered accountants, journalists, management consultants, etc.
  • Not just individuals but also partnership firms, companies, and proprietorships are eligible for this loan.

What are the documents required for a Professional Loan application?

  • Proofs and account statements of the business concerned.
  • Membership certificate indicating the certification of the professional in the concerned department.
  • Income statements, financial audits, and income tax filing records for the last three financial years.

Conclusion

Attractive interest rates, feasible loan repayment tenures, minimal loan processing fees, and a digital-driven platform makes access to Professional Loans easy and handy. All these together enable a qualified professional's career and life to grow and excel abundantly in their concerned industry. Moreover, the loan providers only require good records of the income statements and the financial capability to repay the loan without any hassles. Furthermore, the loans take a minimum processing time and get approved within a day or two if you are eligible. Hence, Professional Loans are the best and quickest option for financing professional aspirations.

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