Business Loan without Security: How to avail in 3 Easy Steps?

A business loan is a credit facility offered to business owners in India to help them with business funding. There are several times when a business owner is not able to meet the financial requirements of the business. For this, he looks forward to availing an external finance sourcing. There are two types of business loans available- business loan with security and business loan without security.

What is a Business Loan without Security?

A business loan in India without security is offered to small and medium business owners who cannot afford to pledge security. Generally, to avail a business loan or any other type of loan for that matter, the borrower is asked to pledge an asset to back the loan amount in case of default. This type of loans is called a secured loan.

However, not all small business owners can afford to pledge security or they do not wish to take the risk. Thus, they cannot avail collateral loans. These unsecured business loans are the loans which are offered without security. There is no need for the business owner or borrower to offer an asset as security. Thus, business loans without security are the best types of loans for them.

How to avail a Loan for Business without Security?

A business loan without security involves a certain amount of risk due to no collateral or security. Therefore, not all banks and traditional lenders offer unsecured business loans. Generally, these loans are offered by NBFCs and Online Lending Companies. So, a businessman too can avail a business loan without collateral from them.

In addition, NBFCs offer business loans at basic eligibility criteria that enable all small business owner to get access to additional funds. They require minimal documentation, offer an online loan application, and have a fast turnaround time. In fact, many NBFCs also offer business loans in just 3 days. The SME owner can look for such lenders and apply with them.

The following are the steps to apply for a business loan without security:

• Search Lender: search for the loan lenders who offer collateral-free business loans. After shortlisting them, check for their eligibility criteria and other terms and conditions. Zero in on a lender whose eligibility, terms and conditions, and all other requirements you meet. This will ensure that the loan application will get approved in the first go itself.
• Apply for Loan: after finalizing the lender, next, apply for a loan. If an NBFC is shortlisted, they offer an online loan application. Visit their website, fill the application online, and submit. It won’t take more than 10 minutes to fill the application. Also, with the online application, there is no need to visit the lender’s office.
• Submit Documents: the last step is to submit the documents required by the lender. If you have applied for a business loan online, you can also submit documents online on the website. However, it is suggested that you upload documents in PDF format to make it easy for the lender to process the application.

Now that you know how to get a business loan without security, you can take its advantages for the benefit of your small business in India.