About SME Loan

SME finance is the funding of small and medium-sized enterprises and represents a major function of the general business finance market – in which capital for different types of firms are supplied, acquired, and priced. … However, not all business finance is external/commercially supplied through the market.

Lenbor lets you borrowing money through an online service that matches you directly with individuals and institutions. The online technology empowers you to quickly reach lots of debt/income investors you wouldn’t have access to otherwise. Lenbor is the portal that connects borrowers to investors in a matter of minutes

For startup business owners who don’t have great credit, sufficient collateral, or a lot of other options, a nonprofit lender can be just the resource you need. These lenders have specific criteria they use when looking for borrowers. You will have to find one that matches who you are or what your business.

To make your SME loan journey a smooth sail, this article we will help you to know eligibility criteria, rates of interest, process, necessary documents, comparison and transfer for lowest rates.

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SME Loan Types

Lenders at Lenbor offer SME loans not only for buying a house but also for a variety of other purposes. Popular types of SME loans available with us are mentioned below.

  • Term Loans. A term loan is a lump sum loan that you’ll pay back, plus interest, over a set term.
  • Short-Term Loans
  • Business Lines of Credit.
  • Equipment Financing.
  • Invoice Financing.
  • Merchant Cash Advances.

 

Equipment Loans: Finance New Equipment

One of the most popular asset-based loans is equipment financing. This is a potential fit if the reason you’re looking for money is to buy a piece of equipment.

Whenever you want to purchase new equipment, instead of paying for it outright, if you take an equipment loan to fund the purchase, lenders will use the actual equipment you’re buying to collateralize the loan. This increases your chances of qualifying, and potentially helps you get a better rate.

Then you pay back the loan just as you would any other loan, but now you own the equipment, which is better than, if you were leasing it.

Invoice Financing: Solve Your Sluggish Cash Flow

Another popular type of loan (that comes in many shapes and sizes) is invoice financing. With this small business loan type, you use your outstanding invoices to get a cash advance from a lender.

Invoice financing works in a lot of different ways but the most popular way is when a lender advances you a certain percent of your total invoice amount (say, 85%), and holds onto the remaining percent. Then as you’re both waiting for your customer to pay, you’re usually charged a certain percent per week outstanding (say, 1% per week). Once your customer pays, the lender will return the remaining 15%, minus their fees (1% per week and usually an additional flat processing fee, say 3%).

This is a great option if you have cash flow problems and your business simply can’t wait for a customer pay. You have rent, payroll needs… The list goes on.

This type of loan is usually best for B2B businesses.

Short-Term Loans: Quick Access to Working Capital

One of the most popular loan types found online is a short-term loan. With this loan type, you are advanced a certain amount of money that you end up paying back daily over the course of 3 to 18 months

The title pretty much says it—this is debt that is very short-term. But what the title doesn’t tell you is that it comes at a price.

Short-term loans have easy applications and looser eligibility requirements. Because of this, though, they can also get quite pricey.

They are a good loan product for the right type of business, but if you’re evaluating this type of business loan, be sure your cash flow can handle the daily payments and you truly understand the cost of the loan.

Merchant Cash Advance: Daily Credit Card Sales for Payback

The product that essentially created the online lending industry is something called a merchant cash advance.

With a merchant cash advance (or MCA), a lender basically purchases a portion of your daily credit card sales. And then you pay back the advance with; you guessed it, a percent of your daily credit sales.

The plus here is when business is slow, you pay back less, and when it booms, you pay back more. But the downside here is that an MCA is known to be the most expensive type of loan on the market.

If you’re evaluating a merchant cash advance, be certain your cash flow can handle it and that there aren’t any other types of business loans you might qualify for.

Personal Loans for Business Purposes

Another option for startup funding is using a personal loan for business. Obviously, lenders will be making this type of loan to you, the business owner, so personal credit will absolutely come into play.

SME Loan – Eligibility

  • The business that is small, medium or micro enterprise should be registered in India.
  • You should be an Indian resident aged between 25-66 years
  • Your business should have a vintage of at least 3 years
  • If it is a new start up then a detailed project report with business highlights and risk factors should serve the base for granting SME loan.
  • If it is an established business in SME category then previous years financial reports will serve the base for granting SME loans.
  • Self employed professionals i.e. Doctors, lawyers, chartered accountants or architects as well as self employed non-professionals i.e. sole proprietors, shop owners etc both are eligible for loans under this category.

 

  • Business Credit Cards.

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Features of SME Loan

All loans are not created equal, SMEloan has become a great option for people to use.

Faster Loan

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Choose your amount

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Enjoy the best rates

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Decide your tenure

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SME Loan - Eligibility

Any salaried, self-employed or professional Public and Privat companies, Government sector employees including Public Sector is eligible for a personal loan.

Age

Maximum age of applicant at loan maturity: 60 years

Income

Minimum Net Monthly Income: Rs 15,000

Credit Rating

Applicant should have the bank specified credit score.

Frequently Ask Questions

If you have a question that deals with clients, customers or the public in general, there is bound to be a need for the FAQ page.

Yes. There is never a fee for making prepayments or paying your loan off early.

To pay off your loan or to see what your payoff amount is for a given date, Sign In to your Prosper account. You will see a line titled “Remaining balance”, which shows the entire amount due on your loan as of today. To see what your payoff amount is for a future date or to schedule a payment, simply select the “Pay off loan” link and choose the date you’d like to pay your loan off. The “Payoff amount” button will display the balance on your loan on the selected date. To schedule a payment select “Make an additional payment”.

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