Consumer choices, market disorderliness and dynamics are the primary reasons for the success of small and medium-sized enterprises. A small business owner faces many challenges like the competition that drives growth and financial insecurity due to difficulty in securing loans on time.
However, many NBFCs now provide short-term loans to SMEs. The benefits of these loans are:
Short-term business loans are for self-employed professionals/non-professionals and entities. Passport-sized photographs, business and financial documents are all that is required.
NBFCs provide flexible SME loan schemes with loans up to 30 lakhs at reasonable interest rates.
Many short-term business loans are collateral-free loans, involving minimum documentation and processing time.
Line of Credit
This facility allows the borrower to withdraw funds to a maximum value set by the lender. Repayment during the tenure includes only the interest. Principal is repaid when the tenure ends.
Some lenders allow borrowers to avail loans beyond what they are eligible for.
Lenders provide exclusive loans for specific financial needs of SMEs.
Some NBFCs provide preapproved short-term loans with benefits like top-up loans and minimal interest rates.
SME loans aid in sustaining a business during times of difficulty, during expansion and in survival, progress and increasing returns.
Also Read: www.savingnspending.com/short-term-loans-can-benefit-small-businesses/
Aman Khanna is an experienced financial advisor who is well known for his ability to foretell the market trends as well as for his financial astuteness. He has an MBA in finance from Toronto University as well as years of experience delivering seminars on sound financial practices and debt management.