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Instant loan is one of the ways to get immediate financial assistance for your business. However, are you aware of the approval process and rates of interest? This article gives insights into the instant loans approval process, lending institutions and rates of interest.

Business Loans

Instant loan: How to get it approved?

As the name suggests the instant loan is quickly approved and disbursed. However, in order to get it approved, you need to select the right type of loan, fit in eligibility criteria and upload all required documents. If all these steps are followed diligently, you will be able to fulfill your financial gap quickly.

Here is an explanation of how you can follow each step to get your business loan approved within no time.

Check for available options

There are a few kinds of options that can provide you with instant financial support when required. Here are some of the options that you can explore to get an instant business loan:

  • Overdraft facility: All banks offer overdraft facilities to businesses. Meaning you will be able to withdraw more money than the balance in your account. The bank will charge interest on the additional amount you withdrew. You can check the limit of the overdraft facility with your bank.
  • Pre-approved loan: If you want to obtain an instant loan, firstly, check with your bank if it is offering any pre-approved loan. It is one of the quickest ways of obtaining a loan. Since the bank already has your financial records such as bank statements and KYC documents, you may not even have to submit any documents for obtaining the loan.
  • Quick business loans: Check with other banks and NBFCs if they offer an instant business loan. You can also explore business loans from Tata nexarc for instant loan needs. You can avail of an instant business loan of up to ₹50 Lakhs. The application process is simple and hassle-free. You can fill in the form online upload the required documents and get approval from renowned financial institutions within a few minutes. Apply now.

Check the maximum loan limit

Once you shortlist the type of instant loan you are looking for, you will need to determine your financial need and check the lender’s maximum limit for an instant business loan. Check if the loan amount is sufficient for your needs. Different lending institutions have different maximum loan limits for instant loans. Here are some examples:

  • HDFC Bank provides instant business loans of up to ₹75 Lakhs
  • Tata Capital offers loan from ₹40,000 to ₹75 Lakhs
  • SBI Simplified Small Business Loan’s maximum limit is ₹25 Lakhs

Note: It is best to check the maximum loan amount with the bank before applying. The amounts mentioned below are subject to change as per the decision of the lending institute.

Read the eligibility criteria carefully and compare loan schemes

Check the eligibility criteria, before applying. Make sure you are eligible for the loan scheme you plan to avail of. Else, your loan application will not be approved. For example, HDFC Bank’s one of the eligibility criteria for a business loan is a minimum turnover of the business should be ₹40 Lakhs. If your turnover is lesser than that, your loan application will not be accepted.

Check your credit score

Is a CIBIL score required for availing of an instant business loan? Generally, a credit score or CIBIL score is not required for an instant business loan. However, it is best to know your credit score and maintain a higher score so that loan processing can takes place quickly. Having a higher credit score is an added advantage.

Collate a list of documents required

Instant loan processing is usually a paperless process that needs minimal documentation. Therefore, learn about the documentation required beforehand. Since, you will need to upload them while applying, understand the acceptable formats. Usually, .pdf, .jpg, etc., are some of the commonly accepted formats for uploading documents.

Usually, an instant loan will not require a business plan or a project plan, however, it is best to have it ready.

Instant loan: Rate of interest

The rate of interest varies depending on the lending institution, type of loan, etc. Here are the rates of interest of a few banks and loan types.

Business Loan
Lending institution Type of instant loan Rate of interest
SBI Business loan 10% onwards
SBI Overdraft facility 9.65 onwards
HDFC Bank Overdraft facility 12-21%
Induslnd Bank Overdraft facility 11.25% onwards
Tata Capital Instant business loan 13-20%
ICICI Bank Overdraft 11-18%
ICICI Bank ICIC Bank business loan 12.5% onwards
Axis Bank Pre-approved loan 14.65-19%

Note: It is best to check the latest rate of interest with the bank/NBFC. The interest rates are subject to change periodically.

Final thoughts: Things to remember

  • Remember that instant loans business loans are meant for instant availability of credit. Therefore, its interest rate may be higher than a regular business loan.
  • If you have time in hand, you can apply for a loan in multiple banks, you can compare loan schemes, their rates of interest and other features to ensure you get the best suitable loan scheme for your business.
  • When choosing the instant loan scheme for your business, read the loan agreement or terms and conditions carefully.
  • There have been several business loan scams recorded especially in the case of pre-approved loans. Therefore, it is best to be vigilant.

Frequently asked questions

Can a one-person company obtain an instant business loan?

Yes. An owner of a one-person company can obtain an instant business loan or instant personal loan. As mentioned above, various options for instant business loans are also available for a one-person company.

Who is eligible for an instant business loan?

Along with businesses, self-employed professionals are also eligible for an instant business loan. However, the eligibility criteria differ from bank to bank. Therefore, it is best to confirm eligibility before applying for a loan.

Can you get an instant loan with a low credit score?

You may be able to get financial assistance with the help of instant loans such as overdrafts. However, it Is advisable to maintain a higher credit score to obtain a credit facility.