Three Ways To Consolidate Business Debt

If you fail to repay the loan installments, you are marked as a defaulter. Read on to know the consequences of being default on loan payments at IIFL finance.

23 Aug,2022 08:36 IST 54 Views
Three Ways To Consolidate Business Debt

Cash flow may not be consistent while running a business. A lack of funds may lead to procuring a business loan to facilitate operations. If you take a few loans for business to run your company, you may have to take care of various monthly payments. However, when running a business, you want to focus on its products and operations, not on different due dates, interest rates, and balances. In this case, debt consolidation is the best option.

This article suggests three simple ways to consolidate your business debt.

How Does Business Debt Consolidation Work?

Debt consolidation simply refers to applying for a new loan to pay all existing loans. A business debt consolidation loan allows you to streamline all your debts into one. Especially, as an MSME that requires constant funding, you can check your MSME loan details and consolidate them into one business loan.

Typically, business debt consolidation and personal loan consolidation work similarly. The inherent logic is to look for a loan with a lower interest rate than the current one. You must ensure that the consolidation loan covers all the outstanding debt.

What Are The Three Ways To Consolidate Business Debt?

Three easy ways to reduce your business debt are:

1. Bank Loans

Banks and credit unions are some of the most accessible options available. You must have a good credit history to qualify for a bank business loan. The criteria vary from one bank to another.
Sapna aapka. Business Loan Humara.
Apply Now

2. Personal Loans

You can take personal loans of up to INR 25 lakhs. If this covers your entire business debt, and at a low-interest rate, this can be a suitable way for you. It is one of the most flexible options for consolidating debt. It also gives flexible repayment terms and tenors.

3. Switching Business Credit Card Balance To Another Lender

If your business credit card lender is not offering high credit or levies a higher interest rate, you should consider switching providers. A credit card balance transfer means transferring your existing card balance to a new provider, keeping the balance amount the same but at an affordable interest rate and higher credit limit.

Apply For A Small Business Loan With IIFL Finance

IIFL Finance is a leading business loan provider. Since its inception three decades ago, it has helped several business owners have a hassle-free experience. IIFL Finance offers quick loans that are perfect for MSMEs with small financial requirements up to INR 30 lakh. You can check the MSME loan details at your nearest IIFL Finance branch or online.

We ensure you focus on your business operations more than financial hurdles. The entire process, from application to disbursement, is 100% online. Therefore, you do not need to visit any branch. The disbursals are quick and take 24-48 hours. You can fulfill various business needs and repay as per your preferred cycle.

Frequently Asked Questions

Q.1: Can you consolidate business debt?
Ans: Yes, many lenders allow you to consolidate your existing business debt with a new loan called the business debt consolidation loan. You can bundle multiple, smaller loans into one repayment schedule with business debt consolidation funds.

Q.2: Does debt qualification hurt the credit score?
Ans: Generally, debt consolidation does not hurt your credit score. Instead, it can use your business debt consolidation loan to pay your EMIs and manage your finances more effectively. You can use this consolidated debt to improve your credit score. However, it can hurt your credit score if you fail to make timely payments or extend your credit utilization.

Q.3: Are debt consolidations useful?
Ans: Debt consolidation is worth it if you have multiple debts and could benefit from a single loan with one repayment schedule at a less frequency.

Sapna aapka. Business Loan Humara.
Apply Now

Disclaimer: The information contained in this post is for general information purposes only. IIFL Finance Limited (including its associates and affiliates) ("the Company") assumes no liability or responsibility for any errors or omissions in the contents of this post and under no circumstances shall the Company be liable for any damage, loss, injury or disappointment etc. suffered by any reader. All information in this post is provided "as is", with no guarantee of completeness, accuracy, timeliness or of the results etc. obtained from the use of this information, and without warranty of any kind, express or implied, including, but not limited to warranties of performance, merchantability and fitness for a particular purpose. Given the changing nature of laws, rules and regulations, there may be delays, omissions or inaccuracies in the information contained in this post. The information on this post is provided with the understanding that the Company is not herein engaged in rendering legal, accounting, tax, or other professional advice and services. As such, it should not be used as a substitute for consultation with professional accounting, tax, legal or other competent advisers. This post may contain views and opinions which are those of the authors and do not necessarily reflect the official policy or position of any other agency or organization. This post may also contain links to external websites that are not provided or maintained by or in any way affiliated with the Company and the Company does not guarantee the accuracy, relevance, timeliness, or completeness of any information on these external websites. Any/ all (Gold/ Personal/ Business) loan product specifications and information that maybe stated in this post are subject to change from time to time, readers are advised to reach out to the Company for current specifications of the said (Gold/ Personal/ Business) loan.

Most Read

Franking and Stamping: What’s the difference?
14 Aug,2017 03:45 IST
Like 2919 2919 Likes
Personal Loan With Low CIBIL Score
21 Jun,2022 09:38 IST
Like 583 583 Likes
Difference Between 24 Karat and 22 Karat Gold
8 Dec,2022 09:26 IST
Like 175 175 Likes
Why Is Gold Cheap In Kerala?
14 Jan,2023 09:35 IST
Like 11 1802 Likes

Get Business Loan