Quick Business Loans for SMEs and MSMEs

Many enterprises launch themselves with great hope and confidence. However, on an average, one in every four start-ups fails to make it past its first year due to a paucity of funds. Low profits, high overhead or unforeseen expenses, incorrect product pricing, and overstocking of inventories can lead to negative cash flow for any small or medium enterprise (SME).

When the paucity of funds has been created by dubious business strategies, the owners need to review their style of working and make required changes. Other than that, there are times when the enterprise is doing well in its industry and simply needs some additional funds to add more facilities for customers/employees, buy raw materials, develop new product features or expand the business to a new location.

A lack of adequate working capital for such steps towards growth or innovation does not imply that the business is unprofitable. It merely needs to ask for an SME loan from a formal lenders at this stage.

While there are multiple sources of any SME or MSME loan, the priority of borrowers who are keen to execute a profitable business plan or fund the expansion of their venture is to get a quick business loan for SMEs/MSMEs. They do not want to miss the opportunities at hand and search for lenders who can finance their plans in minimum time.

How to get the fastest business loan ?

In an age when digital technology is facilitating different transactions for both businesses and consumers, several non-banking finance companies have emerged as FinTech (acronym for financial technology) lenders who have condensed the loan-granting process. A FinTech company can be the source of fastest business loan for SMEs/MSMEs.

Applying for a Quick Business Loan and Its Benefits –

As a leading FinTech company offering fastest business loan for SMEs/MSMEs, Capital Float funds the growth of Pvt Ltd, Prop and LLP companies in various industries. We have an array of credit products for SME and MSME units that have robust strategies for continual progress in their domains.

To make a working capital loan accessible for more and more businesses, we at Capital Float have a simple eligibility criterion that only requires the borrowers to show a potential for growth in their industry. This efficacy can be proven with a minimum operational history of one year and a certain yearly revenue benchmark, which differs as per the nature of the business/profession, and can be checked on our website or by calling our team at 1860 419 0999.

The process of applying for our SME loan is fully digitalised, and it takes less than 10 minutes to fill in the necessary details. The relevant documents can also be uploaded online to support the information provided in the application. These generally include soft copies of papers validating business ownership, KYC documents, ITR/GST returns and recent bank statements.

Once it is submitted, we review the application on the same day, and upon approval, the requested amount is disbursed within 48-72 hours. The speedy disbursal of funds enables the borrowers to implement their business upgrade/improvement/expansion plans and advance on their profitable journey. The returns from such steps for business growth also make the repayment process stress-free.

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If you have a business plan that will take your ambitious venture to its next stage of growth, Capital Float has a quick Business loan for SMEs/MSMEs that you can use to finance it. For more information on our loans or to meet us personally, do write to us on info@capitalfloat.com

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Revised GST Rates – with effect from 25 January 2018

The 25th GST Council was held on 18 January 2018, and the rates of 29 goods and 53 services were reduced to lower tax slabs. These revised rates came into effect on 25 January. Other highlights of the panel included the decision to divide between the Centre and State, collections worth ₹35,000 crores from the Integrated Goods and Services Tax. The proposal to bring petroleum and diesel products under the ambit of GST is likely to be considered in the next meeting.

Here are the key goods and services that have been lowered or raised into new GST slabs.  

Good/Service Present GST Rates Revised GST Rates
Diamonds & precious stones 3% 0.25%
Articles of straw, esparto or other plaiting materials, Velvet fabric 12% 5%
LPG supplied to household domestic consumers, Raw materials and consumables needed for launch vehicles, satellites and payloads, Tamarind kernel powder, Mehendi paste in cones, Tailoring services, Transportation of petroleum crude and petroleum products, job-work services for manufacture of leather goods and footwear 18% 5%
Sugar boiled confectionery, Drinking water packed in 20 litre bottles, Biodiesel, Drip irrigation system including laterals & sprinklers, Mechanical sprayer, Fertilizer grade Phosphoric acid, Bamboo wood building joinery, Transportation of petroleum crude and petroleum products with ITC credit, Metro and monorail projects, Common effluent treatment plants services for treatment of effluents, Mining or exploration services of petroleum crude and natural gas and for drilling services in respect of the said goods 18% 12%
Old and used motor vehicles(other than medium & large cars and SUVs) with a condition than no ITC is availed 28% 12%
Old and used motor vehicles [medium and large cars and SUVs] with a condition that No ITC is availed, Public transport buses that run on biofuel, Services by way of admission to theme parks, water parks, joy rides, merry-go-rounds, go-karting and ballet 28% 18%
Small housekeeping service providers, notified under section 9 (5) of GST Act, who provide housekeeping service through ECO,  without availing ITC nil 5%
Actionable claim in the form of chance to win in betting and gambling including horse racing nil 28%
Rice bran(other than de-oiled rice bran) 0% 5%
Cigarette filter rods 12% 18%

Oct 24, 2018

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What is a Business Loan? How to Apply for It?

A start-up that takes off well with its business idea gradually strategizes about other plans to cement its growth. However, despite a fair degree of success, these small and medium enterprises (SMEs) can face a shortage of funds to fuel their progress.

The business revenue that helps to pay employees, purchase raw materials, maintain the premises, meet other expenses and even make profits may not be enough to invest in further growth. Fortunately, there are business loans that come to the rescue of enterprising organisations at this time. These are provided by banks, non-banking finance companies (NBFCs) and private money lenders.

This article answers some of the frequently asked questions (FAQs) on unsecured and fast business loans offered by NBFCS with a digital lending model. They are also referred to as FinTech companies and are being increasingly approached by startups who find their lending policies more flexible than those of conventional sources.

What is a business loan?

A business loan is a form of financial support that helps commercial organisations to keep up with their growth plans. It is particularly valuable for micro, small and medium enterprises that start their operations with a low level of funds and may not have a substantial amount of funds to invest in bigger initiatives. These include the purchase of new machinery/equipment, adding more product lines, upgrading product features, starting the business at a new location or any other activity that will improve and develop the enterprise.

Is it really a good idea to take a business loan? Won’t it be an additional burden in books of accounts?

Any loan is a liability in accounts. However, when a business takes credit for productive purposes, it can also afford to pay it back with the revenue generated by intelligently channelizing the funds. When there is an attractive business opportunity, and it merely needs some financial investment, the required funds can materialize in the form of fast business loans offered by a FinTech lending company.

If the business procrastinates, the amount required in investment may increase with time, or the opportunity may completely vanish. It is, therefore, better to borrow the funds from an institutional lender and take advantage of the opportunity when it is available.

Thanks to the flexible repayment policies of FinTech lenders, the debt can be cleared before the scheduled term of the loan.

How to apply for a business loan? Does an MSME need anything, in particular, to apply for these funds?

Applying for a loan at a Fintech lender is a simple process that takes less than 10 minutes. The application is available online and asks for basic information of the and the enterprise in question. An MSME should have been operating in its industry for at least one year to be an eligible borrower.

The details provided in the digital application need to be substantiated with corresponding documents. This stipulation, however, does not require the borrowers to send any printed copies of the papers to the lender’s office. They only need to scan the necessary documents and upload them as PDFs with the application.

What are the documents required for a business loan application?

A FinTech lender typically asks for minimum possible documentation. It simply wants to verify the credentials of the prospective borrower and make sure that the business has been operating in conformity with the tax regulations and statutory laws of the country. Generally, the required paperwork include:

  • Photo IDs and KYC documents of the business owners
  • Latest ITR/GST returns
  • Business bank account statements for the last six months to one year

The loans provided by a FinTech company are often tailored based on the amount approved, the term of the loan and the purpose of the loan. At times, borrowers may be required to submit a few additional documents . They can find answers to queries such as ‘how to apply for working capital loan’ or ‘how to apply for machinery loan’ on the company’s website. For more details, they can call the customer service team and get the exact list of documents pertaining to their loan.

How long does it take for a business loan to be approved?

In addition to ‘how to apply for business loan’, a frequently asked question on this subject relates to the time within which the finance is available for use.

It usually takes between 1-6 weeks to get a business loan from private and public sector banks, while it only takes three days when such funding is availed from a Fintech lender. Due to the digitized application and document submission system, it does not take long to review the details and provide a decision on the requested funds. For every approved application, the money is deposited in the business bank account within 2-3 business days.

How much loan can a business get from a FinTech lender?

This depends on the individual requirements and the purpose of the loan. While the range of available credit from a FinTech lender can start from five lakhs and go up to a crore, it is recommended that the borrowers have a near-precise idea of the sum that will help them to fulfil their requirement.

Some businesses apply for only a part of the total required sum and make the remaining investment from their savings. Keeping the loan amount on the lower side is a sound way to avoid paying unnecessary interest. Similarly, borrowing a lower amount may result in the SME falling short of funds at a later stage. SMEs must evaluate their credit needs as closely as possible while applying for a loan.

Nevertheless, FinTech lenders do not turn down requests for ‘big amounts’ once they have verified the earning capacity of a business and are confident that the borrower would not default on repayments.

A FinTech company may also offer an eligibility calculator to help the potential borrowers calculate the maximum amounts they can borrow. Such a calculator takes business earnings, expenses and its operational history into account to compute the borrowable funds. Capital Float understands the anxiety of a business that wonders ‘how to apply for business loan without collateral’? We know that many SMEs are unable to get the loan they deserve due to lack of financial assets to pledge as collateral. This is why we offer only unsecured business loans.

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Your enterprise qualifies for our funding if it has a minimum operational history of one year, has been earning reasonable revenue throughout its tenure, has a sound credit history and is compliant with the laws of the land. To know more about fast business loans and for queries on any specific working capital loan, please call us at 1860 419 0999. You can also meet us in person by scheduling an appointment.

Oct 24, 2018

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What is Capital Float’s Pay Later?

Business owners frequently face working capital challenges. Supplier payments are a constant concern for SMEs. In manufacturing, trading and services, where lead times are significantly high, businessmen often finance operations by resorting to informal channels of credit. Traders who deal with shorter sales cycles tend to miss out on large orders as they are unable to pay their suppliers large sums of money to make bookings.

Capital Float’s Pay Later works exceptionally well in these cases. Pay Later carries a pre- defined credit facility which is unique to each applicant depending on various factors, for instance, industry the applicant operates in, scale of the applicant’s business and some basic financial metrics. You can make multiple drawdowns from the assigned balance and pay interest only on amounts utilized. By repaying the amount used, you reset the balance for further usage, making Pay Later a flexible, rolling loan product.

For example, if you’ve been provided a credit facility of Rs 1 lakh, you can make up to 4 drawdowns of Rs 25,000 each. Upon your first drawdown, you have a balance of Rs 75,000. You will be charged interest on the drawdown (Rs 25,000) and not the entire amount (Rs 1,00,000). By repaying the amount used, your balance will be restored to Rs 1,00,000.

With Capital Float’s convenient mobile app, you can use this zero-collateral loan product from absolutely anywhere. To make payments, all you need to do is take a photograph of the invoice with your mobile phone and upload it using our app. The vendor is paid on your behalf within 24 hours of the upload.

Features

Pay Later is an incredibly fast and paperless access to credit that works along the similar lines of a credit card. The functionality of this product as the name suggests – use the facility now and simply pay later. Following are the salient features of the product:

1. Get credit of up to Rs. 25 Lacs

With Pay Later, you are eligible for credit of up to Rs. 25 Lacs, which ensures that you’re never short of funds.

2. Easy, hassle-free online application procedure

The entire procedure will take just 10 minutes of your time. To get started, you can sign-up on Capital Float using your desktop, laptop, tablet or smartphone. Fill a simple online application form and submit the requested documentation to conclude the process.

3. Get approved in 3 days

Where traditional financial institutions take up to 8-12 weeks, we assess your eligibility and offer you a customized credit amount within 72 hours.

4. Convenient repayment at the end of 30/60/90-day loan term

Pay Later offers three flexible repayment plans that work in accordance to your business cash flows. You can choose to repay loan amounts at the end of 30/60/90 days from the date the loan is utilized. This way, you’re never bogged down by hefty monthly instalments.

5. Pay distributors/suppliers via Capital Float’s convenient mobile app

Make payments with just a few taps on your smartphone via our mobile app that you can download for free from Play Store and App Store. The payment is confirmed instantly, and reaches the vendor’s account in less than 24 hours.

Benefits

1. Zero-Collateral

Pay Later is a collateral-free loan product, which means you don’t need to pledge your property or assets to avail the loan. Your credit amount is determined by the potential and profitability of your business.

2. Flexibility in drawdowns:

Pay Later allows you to use a portion of the total amount any time you wish to. For instance, if you have a credit facility of Rs. 10 lakhs, then you can utilise the full amount or a fraction of it at any given time, depending upon your requirement. The user-friendly mobile app efficiently keeps track of your balance, so that you can manage repayments accordingly. You can also draw amounts as low as 25,000 rupees, hence making this product extremely convenient to use.

3. Interest applicable only upon drawdown

You’re required to pay interest only for the amount you’ve utilised and not on the entire credit amount assigned to you.

Click here to read about the features and benefits in more detail.

Eligibility and Documents

The eligibility criteria for Pay Later is extremely simple. All you need is a small list of documents at the time of application:

Eligibility

  • Applicant’s business to have at least 2 years of vintage
  • Applicant must purchase from a reputed supplier
  • Applicant must have 3 months of transaction data with the supplier

Documents required

  • Audited financials for the last 2 years
  • VAT returns and bank documents for the last 6 months
  • KYC documents of the applicant as well as the organisation

How to Apply

Applying for credit via Pay Later involves a simple four-step procedure. As long as you have a computer or smartphone and a good internet connection, you can apply from anywhere. Here are the steps involved:

  1. Apply & get empaneled

Sign up on Capital Float’s website to kick-start the procedure. Fill out the form with your personal and professional details, and click on submit.

      2. Upload the necessary documents

The next step involves uploading the requested documents. This includes business vintage of two years along with some basic KYC documents.

     3. Receive instant approval

Receive approval on your application within hours. In less than 3 days from the time of application, your credit facility will be set up for your use.

    4. Credit facility ready for use

Once your credit amount is determined, you can start using Capital Float’s mobile app to create tranches by uploading invoices and making vendor payments.

Fees and Charges

At Capital Float, we conduct business in the most transparent manner possible. Therefore, you’re only obligated to pay a processing fee of up to 2% for the loan. Rest assured, there are no hidden or pre-closure charges that pop-up during or after your application procedure.

Oct 24, 2018