What can a School do with a 50 Lakhs Unsecured Loan

In their endeavour to provide quality education and enable all-round development of students through extra-curricular activities, schools in India often need to make some investments. The authorities have to ensure that classrooms are well furnished, there is quality sports kit in the games room, labs have the proper equipment for demonstrations and practical experiments and all essential amenities vital to a respectable educational service are available. To finance such facilities, they may at times seek school loans.

How to get loan for school?” is the first question that comes to mind in such a scenario. Thanks to the digital lending solutions offered by FinTech companies today, recognised schools with classes up to VIII/X/XII standard could easily get collateral-free school loans of up to Rs 50 lakhs.

For what purposes can a school get such an amount? Let’s look at the common reasons that prompt schools to apply for quick loans:

Construct a school building

With a 50 lakh loan for construction of school building, the borrowing institution can build new classrooms to accommodate more students. The amount can also be used to construct a spacious staffroom or for any other structure that the school campus needs. With regular revenue through their monthly fee from students, running schools can afford to pay back the loan amount in EMIs.

Buy school furniture

The furniture used in classrooms and other areas of the school building can seem expensive to buy at short notice. However, quick funding by a FinTech company offering school loans enables the institution to make the purchase conveniently. Like other funds, the amount approved on loan for buying school furniture is credited into the bank account of the borrower within 2-3 days of the application approval and can then be used to purchase the required furniture items.

Build school laboratories

An amount of up to Rs 50 lakhs is usually adequate as a loan for building school laboratory. Schools that have recently advanced their classrooms to X or XII standard may not have science labs for the practical sessions required by the students of these grades. With an unsecured loan from a FinTech lender, they can finance the construction of such facilities. Institutions can also apply for loans to enlarge or refurbish the labs that they already have.

Facilitate transportation

Parents expect safe transport facilities from a school, especially for their younger children. A van, minibus and larger buses can cost anywhere between Rs 7 lakh and Rs 50 lakh depending on its size, brand and age – new/used. Schools that want to buy their own vehicles or enlarge the existing fleet can use FinTech collateral-free loans available for such purposes.

Buy new teaching devices

A quick school loan is the best resort when the school needs to have better teaching devices installed in its classrooms and labs. These could be computers, whiteboards, overhead projectors and other hardware especially commissioned for education purposes. FinTech companies lend up to Rs 50 lakh for such teaching aids.

Develop the school campus

An unsecured loan of Rs 50 lakhs can be used for any other productive purpose that contributes towards the development of school and helps it become a more valuable education service provider. The institution simply needs to state the objective clearly in the loan application and provide the required documents authenticating its eligibility for the fund. It can also arrange for a flexible repayment structure when a FinTech lender disburses the loan for school development.

Apply for Unsecured school loan

As a trusted FinTech company providing loans to schools, Capital Float has customised credit products to support educational institutions across India. To talk about your school loans requirements, feel free to call on 1860 419 0999.

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When to Apply for Business Loan Online – 5 Scenarios

Being proactive never hurt anyone. This is especially true when it comes to running businesses. A successful enterprise needs a steady infusion of finances, and waiting till the very end could prove to be expensive, particularly in the current competitive scenario. Challenges will never cease to exist. The same holds true for business opportunities. Timely action coupled with advance planning for business development sets the leaders apart in a crowd.

How to get a business loan is a question fraught with ifs and buts. Capital Float, the leading alternative lending companies in the online space, assists in overcoming the unique credit needs of a variety of small businesses, thus providing an easy answer to the question.

Here are five scenarios wherein applying for a small business loans online becomes necessary.

1. When expansion is imminent

Small business loans are no longer viewed as a liability. If debt can enable you to seize a lucrative business opportunity, why not utilise it? Online business finances are geared to function according to individual needs, thus empowering a variety of small and medium business enterprises (SMEs). A flourishing business will sooner or later require physically expansion. This doesn’t necessarily mean that it has the cash on hand to make such a move.

Often, traditional banks either work too slow or fail to understand your business goals. Capital Float’s products are the best fit in such situations, and are tailored to fulfil unique credit requirements. Thus, small business goals such as expansion or renovation plans become achievable and affordable through alternative lending means.

Capital Float bridges the credit gap and equips a business in more ways than one by offering flexible access to low-cost capital. These include exploring new markets, a new marketing strategy or, realising expansion plans.

2.Purchase of business tools

Every business employs different tools. While one may require steel cutters, the other may need pizza ovens. Computers may be crucial to one business and curling irons to another. The point being that no business can do without a certain kind of specific equipment. An enterprise may either buy or lease it out.

It makes perfect financial sense to get business finance for purchasing indispensable equipment. Apart from getting a tax-cut, an enterprise can use these tools for the rest of their economic life and even sell it at a reasonable price later, if need be

The problem of how to get a business loan for buying equipment is made easy and convenient by Capital Float. Irrespective of a company’s cost-benefit analysis vis-à-vis buying or leasing business equipment, our customised financial products take care of all your liquidity needs.

3.Replenishing inventory

Sustaining a business in the current digital ecosystem requires continuous supply of inventory. This is especially true for companies working in the online space. Expanding to new marketplaces and staying ahead of the competition entails having enough inventory to meet customer demands. Falling short may jeopardise the reputation and prospects of B2B or B2C companies.

A business can conveniently avoid running into such a situation with Capital Float’s loan products. Enabling several types of small and medium businesses to replenish their inventory ahead of a season, these loan offerings take care of your seasonal inventory purchases. They involve short-term loans which companies normally pay off from profits once the season is over.

4.Boost working capital

Costs pile up long before the first sign of profits. Businesses invariably require working capital or daily cash for taking care of operations, which may range from repair of equipment to payment of salaries. Till the time a fledgling company can earn enough to cover its working capital needs, business loans come in extremely handy. Capital Float caters to a wide range of companies that require small business loans for running daily operations. Easily available without the hassle of lengthy paperwork and excruciatingly slow disbursement times, such loan offerings ensure smooth working of an enterprise. Easy access to timely credit is critical. This is especially true for startups, which require a certain amount of hand-holding initially. Working capital, which can be easily sought through a small business loan, ensures a comparatively smoother running of business.

Easy access to timely credit is critical. This is especially true for startups, which require a certain amount of hand-holding initially. Working capital, which can be easily sought through a small business loan, ensures a comparatively smoother running of business.

This is where Capital Float’s many different loan products make a difference. Small business loans empower entrepreneurs in several ways. These include helping to seize the next business opportunity, taking care of suppliers, using available funds as petty cash, improving profit margins, etc.

5.Change in the organizational life cycle

Every new business starts out as small, which is essentially a time to test the water. With time, business owners get to know the market and their customers better, and inevitably think of taking the bold step of expansion—either into new product/service categories or in terms of scale. This is when they require a business loan.

A smart way to go about this is to start with a small business loan and pay it off on time. This enables a business to build a healthy credit score, which can be advantageous when applying for large-scale financing for business expansion. “How to get a small business loan” is a question easily answered by online FinTech lenders like Capital Float. Build your business credit the easy way through our collateral-free short-term loans,

“How to get a small business loan” is a question easily answered by online FinTech lenders like Capital Float. Build your business credit the easy way through our collateral-free short-term loans, customized to specific needs. Thereafter, work your way up to a large-scale loan with business finance.

Running a profitable company in today’s globally competitive environment requires meticulous planning and timely cash inflows. With the use of big data and analytics, Capital Float can speed up the loan approval and disbursal process, empowering your business with timely credit, enabling you to focus on larger issues such as business growth and development.

Oct 24, 2018

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Understanding Working Capital

Every small and medium sized enterprise requires a certain amount of working capital to ensure smooth business operations. Working capital is nothing but the equity or funds available to owners to meet their short-term financial commitments and expenditures. Calculated by subtracting the value of current liabilities from the current assets of a business, the available capital stands testimony to the financial health and efficiency of an enterprise, particularly in the short-term perspective.

There are various types of working capital such as fixed working capital, temporary working capital, gross and net working capital, etc. to name a few. Since it is the fundamental building block for any enterprise, working capital is a basic requirement that can never be compromised upon. This is why Working Capital Loans are regular finance products offered by any banking entity, and is the most demanded of loans by small, medium and large enterprises.

Benefits of Working Capital Loans

Working capital loans are short term financing options that are used to cover accounts payables, wages and investments on short term assets. SMEs whose business are reliant on seasonality or manufacturers who depend on traders can opt for these loans until their business picks up or they receive payments. Since working capital loans can be used as the SME deems fit and can be availed for shorter terms, they are extremely beneficial to resolve any immediate financial crunch. Moreover, since these loans are disbursed quickly with fewer documentation requirements, owners can be relatively stress-free regarding daily/monthly expenses of wages, purchases, infrastructure bills, etc. till they can keep their businesses afloat.

Types of Working Capital Loans

Though all businesses are eligible to get working capital loans, finance providers will require business owners to meet certain prerequisites or conditions, depending on the scale of their operations. Traditionally, a security deposit or guarantee is required of them, and the working capital loan offered by lending institutions will significantly depend on the enterprise’s credit repayment history, among other things. However, several NBFCs now provide unsecured loans after an analysis of the business’ books. New-age lenders are now comfortable with extending collateral-free working capital loans to SMEs and even micro businesses.

Some of the most common working capital loans available for businesses are:

1. Short Term Loans
These loans are disbursed at a fixed rate of interest for a fixed payment period, which is usually up to 12 months.

2. Bank Overdraft and Loan Facility
The availability and terms of this type of loan are wholly dependent on an enterprise’s relationship with the lender. For this type of loans, the rates of interest are usually one or two percent above the prime interest rate levied by the lender.

3. Account Receivable Loans
Being the most popular of working capital loans, account receivable loans are most sought out by SMEs. This type of finance is the best choice for businesses requiring equity to meet expenditures such as fulfilling a sales contract, investing in an asset, etc.

Features of a Working Capital Loan

There are several banks and NBFCs in India licensed to offer working capital loans to businesses.  Smart SMEs would thoroughly research parameters like loan tenures, rates of interest, repayment terms, security requirements, etc. before opting for a lender, as this choice will have a lasting impact on the way you conduct business and on larger credit needs in the future.

Loan Eligibility – The number of years the business has been in operation, your CIBIL score and annual business turnover are some factors that will affect the loan eligibility, amount, tenure and rate of interest charged on your working capital loan.

Availing the Loan
– Below are some points that an SME should know before entering into discussions with an NBFC for working capital loans.

1. Most working capital loans are offered for a 12-month tenure.
2. Depending on the loan amount, the scale of business and the kind of lender, an interest rate of 12-16% per annum will be charged on the loan amount.
3. Traditionally, lenders would require collateral from SMEs in return for providing a loan. Even today, some lenders need a guarantee to know that the business they are investing capital into is up and running and if the loan amount will be returned.
4. However, several NBFCs now offer collateral-free loans to help SMEs manage their short-term expenditures without compromising on business goals. But the terms and conditions of the NBFC will dictate the type of loan an SME can avail.
5. Remember, bankers and lenders use the working capital ratio as a quick way to determine a company’s financial health.

Documents & Other Prerequisites – An SME needs to furnish certain documents to confirm the intent of repayment or as a measure of security as per the NBFC’s bylaws. Another prerequisite that business houses may require is to be registered under The Company Act 2013 of India as either of the following:

1. sole proprietorship
2. partnership
3. private limited firm
4. public limited firm

KYC documents, ITR financial statements, VAT returns, etc. are some documents that you will be required to show or upload while applying for a loan.

Choosing a Lender – Since the future of a business, its longevity and its ability to operate efficiently could rest on the working capital loan and the relationship with the lender, it is advisable to choose a reputable lender. Look for lenders who offer simple online documentation, customized business loans and quick disbursal before proceeding with one. It is always safe to choose a well-known lender with a modern outlook and flexible conditions to ensure a seamless experience.

It is clear that a company’s balance sheet indicates the amount of working capital available. This capital, equity or funds meet the necessary day-to-day expenses of every organization and are crucial to an enterprise’s success. Though big businesses are more likely to keep aside abundant working capital to meet their expenditures, startups and SMEs can avail working capital loans to ensure that there are no gaps in meeting expenditures to keep their enterprises running smoothly.

Capital Float is a reputable digital lender with a deep understanding of the unique requirements of a business. Our loan packages are designed to fulfil every short term expense that you will come across.

Oct 24, 2018

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Impact of the Union Budget 2018 on Individuals

The Finance Minister, Arun Jaitley, announced the Union Budget 2018 on 1st February 2018 with components possessing the potential to have a transformational influence on various sectors of the economy. The current Indian economy has reached US$ 2.5 Trillion and is on its way to becoming the 5th largest in the world. GDP is projected at 7.4 % while the number of taxpayers has increased from 6.47 crores to 8.27 crores and a direct tax revenue growth rate of 18.7% has been achieved as of January 15th. The Union Budget is poised to leverage this upward trajectory and provide the impetus for further development at a macro and micro level. Many of the provisions in the Budget directly impact the daily life of a common man. This blog intends to dwell upon these provisions.

Health, Housing and Employment Receives a Major Boost

NHPS (National Health Protection Scheme) dubbed as the world’s largest government-funded healthcare program will be extended to provide up to ₹5 lakh towards hospitalisation for 10 crore families and ultimately 50 crore actual beneficiaries from underprivileged backgrounds.

Affordable Housing Fund (AHF) has been announced to ensure housing for all by 2022. Under this program, 51 lakh houses in 2017-18 and 2018-19 each will be constructed in rural areas with 37 lakh houses in urban areas.

₹40,000 crores worth of concessions were announced for senior citizens. The annual exemption limit on interest income from fixed and recurring deposit schemes including small savings instruments has been increased from ₹10,000 to ₹50,000 in addition to increasing the ceiling for Section 80D from ₹30,000 to ₹50,000.

To facilitate employment generation, Government will contribute 12% of wages to EPF for 3 years. The Finance Ministry has also reduced EPF deduction to 8% for women employees thus significantly increasing their take-home salary while maintaining employer contribution at 12%.

A Huge Fillip to Travel and Transportation – Growth and Modernisation

Travel and transportation received a huge fillip across roads, railways and civil aviation. ₹1,48,528 crores have been reserved for boosting railway network capacity and gauge conversion. Over 4000 km will be electrified in addition to redeveloping over 600 major railway stations and progressively equipping all stations and trains with Wi-Fi and CCTV. ₹17,000 crores have also been allotted for augmenting Bangalore’s suburban railway network. The Government will quintuple the number of airports to 124 and connect hitherto unserved 56 airports and 36 heliports under UDAN, the regional connectivity program.  Around 9000 km of highways will be completed by the end of FY 2017-18 and over 35,000 km of interior roads will be completed in Phase 1.

Digital India – Integrated Education and Research – Major Focus

Under the massive ₹3,073 crore Digital India Program, over 5 lakh Wi-Fi hotspots will be set up to provide broadband access to 5 crore rural citizens. This opens up an avenue for individuals in rural India to access formal finance from digital lenders via the internet. New centres of excellence in the areas of AI, Big Data, Quantum communication and Internet of Things (IoT) will be established to boost indigenous intellectual capital in these crucial areas. An additional ₹14,500 crores have been earmarked for strengthening telecom infrastructure including BharatNet. To harness emerging technologies, particularly 5G, an indigenous Test Bed at IIT, Chennai will receive ₹135 crores.

The Government has launched a new program RISE (Revitalization of Infrastructure and Systems in Education) funded by a non-banking financing agency HEFA (Higher Education Financing Agency) with ₹1 lakh crore. In higher education, under the Prime Minister’s Research Fellow Scheme, 1000 B.Tech students will be identified and facilitated to complete PhD at India’s prestigious institutes.  Up to 24 new medical colleges are to be started and upgrade of several existing colleges was announced to ensure at least one Government College for each state in India. Two new schools of planning and architecture will also be set up in addition to 18 more IIT/NIITs.

Personal Tax

On the personal income tax front, there are no new changes in income tax slabs or structure.  However, a standard deduction of ₹ 40,000 will be introduced in lieu of transport and medical allowances while a higher allowance will be allowed for disabled individuals. From April 1, 2018, long-term capital gains of more than ₹ 1 Lakh will be taxed at 10% though gains until January 31, 2018, and will be grandfathered. Dividends from equity Mutual Funds will now attract DDT to perhaps discourage investors investing in Equity funds primarily for dividends. In an effort to promote gold as an attractive asset class, the existing Gold Monetisation Scheme (GMS) will be made more investor-friendly and a network of regulated gold exchanges will be set up.

Balanced Budget

Though the budget was projected as agriculture-oriented and farmer-friendly, it is balanced and well-intentioned. Huge boost to expanding and upgrading transportation infrastructure especially the railways and supporting underprivileged with healthcare, housing and employment are the cornerstones of this Union Budget.  Substantial measures in the areas of digital economy and education pave the way towards India becoming an economic superpower.

Oct 24, 2018