Personal loans are taken by an individual for multiple purposes. The loans can be taken from any of the lenders by the borrower in the case of personal loans. Personal loans are suited for business individuals to expand their own business, start a new business, and increase the flow of money into the business. The loans are available at attractive interest rates of 9-14% per annum. The banks also charge a processing fee of around 1% of the loan amount or Rs.10,000 whichever is lower. The loans can be taken at the best possible negotiated rate in case of a good credit score. The banks approve the personal loans only in case of a good credit score and proper documentation. The interest rates of the banks vary according to the lender to lender. The banks are keen to extend the loans to the borrowers who are amongst the honest payers of credit. The lenders may charge a penalty in case of the late payment of the EMI’s beyond the due date. Thus paying the installments on time is necessary. The interest rates may vary according to the lender to lender. Thus opting for the loans at the lowest possible interest rates is the responsibility of the borrower.
The banks easily approve the loans of the borrower as the amount for the personal loans is comparatively low than that of any other kind of loan. The loans taken if repaid on time can help the borrower improve the CIBIL score which can help in easy availing of future credits. Also availing mix of credit like the credit card, personal loans, car loans, home loans, business loans for SME. Availing of a mix of loans can put a positive impact on the borrower’s credit score. The loans taken can be repaid up to a maximum tenure of 5 years. The loans should be taken according to the affordability of an individual. The loans are approved by an individual according to the income of an individual. The higher the income higher is the approval of the loans for an individual. The maximum liability for the business loans is Rs.25 lakhs up to which the borrower can take the loans from the lender. The loans are necessary to be paid on time to avoid a default of the loans. Loans can be used for the running expenses of the business. A businessman typically needs a huge amount of money for running a business, thus availing loans is an extra source o income for the business to maintain a sufficient flow of cash.
Benefits of personal loans for self-employed
Personal loans can be taken by any of the businessperson as well for the expansion of the business or the smooth running of the business.
Personal loans are useful for entrepreneurs to maintain the cash flow in the business for operational activities.
Personal loans can be taken by an entrepreneur for the purchase of new goods, renovation of the existing space, payment of wages, payment of the outstanding credits.
Personal loans can help the borrower amongst entrepreneurs to keep the business running based on the credits being obtained even in case of a shortage of cash flows.
Personal loans are available to the borrower at reasonable interest rates of 9-14% per annum.
Personal loans taken can help the entrepreneur stock excess quantity of goods for the business or trading purpose.
Modernization of new equipment or machinery can also be done with the help of personal loans.
Documents for personal loans in case of the self-employed
- Aadhar card, pan card, driving license, voter identity card as identity proof.
- Business registration proof.
- Profit & loss statement for income turnover.
- Bank statement for the bank entries.
- Address proof of the residence.
- Address proof of the business shop, warehouse, and office space.
Thus we can conclude that personal loans can be beneficial for the entrepreneur for the running o business activity. Personal loans are available at affordable interest rates to the borrowers. Thus availing of personal loans for business expansion, stocking extra goods, renovation of the business property, buying new machinery can be all sorts of the various benefits being available with the help of personal loans.