Tips To Get A Low-Interest Rate Business Loan

The interest rate on a business loan will save your business time and money. Follow these 7 tips of getting a low interest rate on business loan.

17 Sep,2022 16:50 IST 178 Views
Tips To Get A Low-Interest Rate Business Loan

Businesses of any size can benefit from business loans, whether they need to expand, buy equipment, hire new employees, acquire working capital, or purchase inventory. However, a loan for your business comes at a cost–the interest rate the lender charges.

Obtaining a loan with a lower interest rate will not only save your business time and money, but it will also assist in repaying the debt sooner. How do you accomplish this? These tips will help you get low-rate business loans.

How To Get A Low-Interest Business Loan?

1. Increase Your Credit Score

Obtaining an unsecured business loan requires lenders to consider several factors, including credit score. A credit score of 700 or higher is essential to get low-interest small business loans.

2. Don’t Default Your EMI

An EMI is a standardized monthly deduction towards your loan. Repaying your prior loans without defaulting on your EMI increases your chances of getting a lower interest rate from your bank. Banks will favour you if you maintain a strong repayment history.

3. Design A Good Business Plan

Draft a good business plan to get a loan approved quickly. The key to getting a low-interest business loan is to make a good impression on the lender. Ensure the business plan clearly explains the company's goals, priorities, and strategies.

4. Improve Your Business Financials

The company's financial position, upcoming projects, and turnover are all factors that can help you get lower interest rates from banks. In other words, improving your financial statements will result in lower interest rates.
Sapna aapka. Business Loan Humara.
Apply Now

5. Research And Refinancing

You can often find lower interest rates from competitive lenders than you would get from your current lender. A balance transfer of the loan is an option here, which means the second lender repays your existing loan and offers you a business loan with a reduced interest rate to pay off the balance.

6. Offer Collateral To Secure The Loan

You can also reduce your interest rate by providing collateral to secure the loan, which may help your bank reduce its risk of lending. The loan can be cheaper if you pledge tangible assets as security.

7. Build A Relationship With Your Lender

Customers with a long history with the lender and excellent repayment history will be looked upon favourably by the bank. As a result, you can get a loan with a lower interest rate. Making loan payments on time, delivering documents as requested, and being transparent about business activities are all critical to establishing a good working relationship.

Get A Business Loan With IIFL Finance

Acquire much-needed finance for your business's advertising, marketing, infrastructure, machinery, plants, operations, and other vitals with a business loan. With IIFL Finance, one of India's leading financial institutions, you can avail of a business loan to finance your company’s capital needs.

Get approved in less than 30 minutes by filling out our online application form, uploading your bank statements, and submitting your KYC documents.

Frequently Asked Questions

Q1. Are small business loans secured with assets?
Ans. If you meet the business loan eligibility criteria, you don’t need to pledge any assets. However, if your credit score or history is poor, your lender might ask for collateral before approving a loan.

Q2. Which entities can avail of a business loan?
Ans. Businesses of all types, including individuals, manufacturers, partnerships, companies, retailers, sole proprietorships, etc., can apply for business loans.

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 2918 2918 Likes
Personal Loan With Low CIBIL Score
21 Jun,2022 09:38 IST
Like 582 582 Likes
Difference Between 24 Karat and 22 Karat Gold
8 Dec,2022 09:26 IST
Like 174 174 Likes
Why Is Gold Cheap In Kerala?
14 Jan,2023 09:35 IST
Like 10 1802 Likes

Get Business Loan