3 Best Small Business Loans in India for SMEs

While availing a small business loan, what type of credit facility to avail is one of the important factors to consider. There are different kinds of loans offered in India by loan lenders. So, these options of loans confuse the borrower. However, all types of business loans are designed to serve different needs of the borrower. So, the best loan product would be the one that helps you meet all your requirements in an apt way.

Let’s take a look at different types of loans available in the market that you can choose to avail:

Equipment Loan

Equipment or machinery is an important resource for a business. The products produced and their cost per unit is dependent on the machinery. The quality of the items so produced is also dependent on the machinery. Moreover, if your products will be able to meet the requirements of the customers and clients is also dependent on the equipment.

That said, machinery is usually very expensive and it is not possible for the business owner to buy machinery even if his business is generating good revenues. This may also put pressure on working capital. So, an equipment loan can be availed to buy or upgrade machinery for business. The machinery will also help in producing better quality products at low cost.

Working Capital Loan

Working capital is like oxygen for a business. No matter what segment the business belongs to, working capital helps the business to sustain and grow over time. Every business has some daily expenses that should be met on time to be able to run continuously. These daily expenses are met through working capital.

If you do not have enough liquid funds or working capital, you can avail a working capital loan. The funds availed under this type of loan are only used to meet the daily expenses of the business and not for business expansion.

Capital Loan

Capital is the amount that is initially invested in the business. However, it is also required when expanding or growing business. When a business is started, the business owner invests all his funds in the business. However, at the time of business expansion, he faces a paucity of funds.
This is when he can avail a capital loan. The funds so availed can be used to grow business, start a new product line, or expand the business to a new location. Having said that, a capital loan is only used for business expansion.

The aforementioned three are the best small business loans in India. You can avail them as per your needs and requirements. You are also suggested to a search for the lender who offers the best business loan interest rate in India. Additionally, the one that has an online loan application, basic eligibility criteria, and minimal documentation requirement.You can also apply for a loan with NBFC. NBFCs offer online loan application where you can apply for loan and upload documents online on their website. Also, they approve and disburse the loan amount in just 3 days.