Applying for a business loan involves several steps and requires specific documents and eligibility criteria. Here’s a complete guide tailored for India, though most points apply globally with slight variations:
Steps to Apply for a Business Loan
1. Determine Your Loan Requirement
Know the amount you need.
Decide the purpose (e.g., working capital, expansion, machinery purchase).
2. Choose the Right Lender
Options include:
Banks (SBI, HDFC, ICICI, etc.)
NBFCs (Bajaj Finserv, Lendingkart, etc.)
Government schemes (CGTMSE, MUDRA loan)
Online platforms (Paytm, Razorpay, Indifi)
3. Check Eligibility Criteria
Minimum business vintage (1–3 years)
Minimum annual turnover
Good credit score (usually 700+ for unsecured loans)
Business should be profit-making
4. Gather Required Documents
You’ll typically need:
KYC documents: Aadhaar card, PAN card
Business proof: GST certificate, registration certificate, trade license
Financial statements:
Bank statements (last 6–12 months)
ITR (last 1–3 years)
Balance sheet and P&L
Ownership proof of office/shop (if applicable)
Existing loan details (if any)
5. Apply Online or Offline
Fill out the loan application on the lender’s website or visit the branch.
Upload/submit documents.
Await loan processing and verification.
6. Verification & Approval
Lender will verify documents, check CIBIL score, and assess your repayment ability.
They may call for telephonic or in-person verification.
7. Loan Disbursal
If approved, funds are transferred to your account within 2–7 working days (may vary).
Eligibility Criteria Snapshot (Typical)
| Criteria | Requirement |
|---|---|
| Age | 21–65 years |
| Business Vintage | Min. 1 year (often 2–3 for banks) |
| Annual Turnover | Varies – ₹10L to ₹50L+ |
| Credit Score | 650+ (higher preferred) |
| Location | Business should be in lender’s service area |
Popular Government Loan Schemes for Businesses
MUDRA Loan (Up to ₹10 lakh) – for MSMEs & startups
CGTMSE – Collateral-free loans
Stand-Up India – For SC/ST and women entrepreneurs
SIDBI Loans – Specialized MSME loans
Need Help Applying?
If you tell me:
Your business type (retail, manufacturing, service, etc.)
Age of your business
Approximate revenue
…I can suggest the best loan type, lender, and documents you’ll need.
Would you like that