Factors To Increase Chances Of Getting A Business Loan

Business Loans are a great funding option for SMEs to grow and expand. But getting a Business Loan is not as easy as it sounds. A Business Loan EMI calculator estimates EMIs accurately and facilitates timely payments. However, several factors come into play while determining loan eligibility.

Here are a few factors that will increase the chances of getting a Business Loan:

  • Income: Lending institutions consider the applicant's annual turnover while evaluating loan applications. They determine the repayment capacity based on this parameter. Those with a low income are likely to default on loans. Therefore, they have a higher chance of getting their loan rejected. To overcome this, include all income sources in the application, and find additional income through rent, investment, part-time jobs, or other sources.
  • Financial Obligations: When the loan provider receives a loan application, it investigates the applicant's income and current financial obligations. If the individual is already heavily indebted and spending a significant percentage of revenue on other commitments, they may get their loan rejected. So, consider paying off outstanding balances and reducing the Fixed Obligations Income Ratio (FOIR) before applying for a new Personal Loan.
  • Credit Rating: The credit score is crucial in determining loan eligibility, amount, and interest rate. A score of below 750 might be the primary reason for loan rejection. Improve the rating by repaying EMIs on time, diversifying the credit mix, lengthening the credit history, and requesting a credit limit increase, among other ways.

Take appropriate steps to avoid unfavourable situations and improve your chances of getting Business Loan approval. NBFCs like Poonawalla Fincorp have easy eligibility criteria and minimal documentation requirements. You can also get faster and hassle-free approval. Their Business Loan EMI calculator can help you choose a repayment term with easy EMIs, and repay EMIs on time.

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