Business Loan and How to Get It: Overview
If you are searching for a business loan and how to get it, this guide covers everything you need to know to secure funding for your business in 2025. A business loan is a crucial financial product designed to help businesses meet their needs such as expansion, capital expenditure, working capital, or equipment purchase. Understanding a business loan and how to get it will empower entrepreneurs to make smart borrowing decisions.1, 2
Types of Business Loans in India
- Working Capital Loans: Short-term loans to cover daily operational expenses.
- Term Loans: Long-term loans for capital investments like machinery or infrastructure.
- Unsecured Business Loans: No collateral required; usually for MSMEs and startups.
- Secured Business Loans: Require collateral such as property/assets; tend to have higher limits.
- MSME Loans: Targeted at micro, small, and medium enterprises with government schemes like Pradhan Mantri Mudra Yojana (PMMY), offering loans up to ₹20 lakh.3, 1
Business Loan and How to Get It: Eligibility Criteria
Knowing the eligibility criteria is an important step in understanding business loan and how to get it. Typically, to qualify for a business loan in India, applicants must be Indian nationals with a business vintage of 2-3 years, aged between 24 and 80 years. The business owner should have a minimum credit score of 650-685+ and maintain healthy financial records. These criteria vary by lender and loan type.2, 2, 4
Documents Required for Business Loan and How to Get It
For a smooth business loan and how to get it process, preparing the correct documents is essential. Usually required documents include KYC proofs (PAN card, Aadhaar), business registration certificates (GST, trade license), financial statements (balance sheet, profit & loss), income tax returns, and bank statements. Collateral documents may be needed for secured loans.2, 4, 2
Step-by-Step Process to Get a Business Loan
- Assess Your Business Needs: Determine the loan amount and type based on the purpose like expansion or working capital.
- Check Eligibility: Confirm that your business meets the lender’s criteria (age, vintage, credit score).
- Gather Documents: Prepare all necessary documents like KYC, financials, tax returns, and business proofs.
- Select a Lender: Compare banks, NBFCs, and digital lenders on interest rates, repayment flexibility, and processing time.
- Apply Online or Offline: Submit your loan application online via lender’s website/app or at branch, uploading required documents.
- Verification and Processing: The lender reviews your documents, creditworthiness, and business viability.
- Loan Approval & Disbursal: Once approved, loan funds are credited to your account, often within 48 hours to a few days.2, 5
Tips to Improve Your Business Loan Approval
- Maintain a good CIBIL score of 685+.
- Keep clear, updated, and accurate financial records.
- Provide a solid business plan showcasing growth potential.
- Choose lenders with simplified documentation and faster processing.
- Avoid applying with multiple lenders simultaneously to prevent multiple credit score hits.2, 5
Where to Apply for Business Loans
Top lenders offering business loans in India include:
- Major banks like HDFC Bank, SBI, Axis Bank, Bank of Baroda.
- NBFCs such as Bajaj Finserv, DMI Finance, Shriram Finance.
- Online lending platforms providing instant approval and minimal paperwork.
Many institutions now offer digital applications with quick disbursals, some within 48 hours post-approval.1, 2, 8
Conclusion
Getting a business loan and how to get it in 2025 is more accessible than ever with digital platforms and flexible loan options available. Understanding eligibility, preparing proper documents, and following a clear application process can help secure funds quickly and efficiently.
Entrepreneurs looking to expand or stabilize their business should explore both traditional banks and NBFC options tailored to their business needs.
For more details on business loans and to check eligibility, visit official lender websites like Bajaj Finserv Business Loans and HDFC Business Loans.2, 1
