Unlike earlier, its become easy to getting loan to fund for startup business. many banks provide business loans to start new venture or companies which needed initial capital, expansion etc.
To start any business it require finance which can not be completely funded from the personal savings.
so there are many things to consider before approaching banks for business loan. an entrepreneur should have a clear business plan or hard copy with following details:
All the points must have written in sophisticated manner and the banker should be convinced about the project and promoters and should have confidence that you will be able to pay the interest on time
- Financial objective of the company
- Business plan, promoters, Background,revenue Model
- Size and nature of business
- Growth and expansion plan
- capital and market trend
- Government regulation
some easy steps on how to approach bank:
- Approach the bank with written business plan. sanctioning of the loan and amount will depend on business plan
- Each lender have their own criteria while disbursing loan.so research about business area, competitors. and compare your business that you qualify for a small business loan. there are some required guidelines which needed to considered for small size business
- keep all the documents ready. if you can avail secured business loan by providing a collateral, it will be easy for the bank to sanction the amount.
- on submission it is upto banks to approve the loan and amount startup companies can avail term loan or working capital or asset backed loans depending on the needs and business requirement.