Business loans are essential for startups, MSMEs, and established businesses to expand operations, manage cash flow, or purchase equipment.
What is a Business Loan?
A business loan provides funds to support business activities. It can be secured or unsecured, depending on the lender and loan amount.
Common Uses:
- Working capital
- Purchasing machinery
- Marketing and expansion
- Hiring staff
Types of Business Loans:
- Term loans
- Working capital loans
- MSME loans
- Startup loans
Eligibility:
- Business vintage of 2–3 years
- Stable turnover
- Good credit score
- Proper financial documents
Advantages:
- Helps scale business faster
- Improves cash flow
- Flexible repayment options
Risks:
- High interest for unsecured loans
- Business assets at risk in secured loans
- Poor planning can increase debt burden
Before taking a business loan, always calculate ROI and ensure the loan contributes directly to business growth.
