Jaipur is one of the most famous places in north India. In addition to being a historically important town, it is also a big business centre with many manufacturers, traders, professionals and service providers plying their trade in the city. People from all over the world frequently visit Jaipur for business-related needs or for holidaymaking. This presents an excellent opportunity for small business owners in Jaipur to expand their business and improve their bottom lines. But like every other small business, small business owners in Jaipur also face a paucity of funds from time to time, during the usual course of their business.
If you are also a business owner in Jaipur and are facing the shortage of funds for running your business or expanding your business activities, then you have an excellent option at your disposal. You can avail an unsecured working capital facility or business loan from various financial institutions operating in the city, online as well as offline. There are many financial institutions offering small business financing in Jaipur to help small business owners like you to expand your business and manage your financial liabilities in an effective manner.
What are the various financing option available for small business owners in Jaipur?
With the rising popularity of online lenders as well as an extension of the facilities offered by retail lenders, there is no dearth of option for business owners looking for small business loan in Jaipur. These small business loans are meant to be used for requirements of business only and should not be used for any personal purpose. Following are the most popular funding options available for small business owners in Jaipur: –
- Unsecured Loans: As the name suggests, unsecured business loans are those small business loans which do not require any collateral to secure the loan amount. You are free to use the money as per your discretion but for a business-related purpose only. The maximum business loan repayment tenor for an unsecured loan can vary from one lender to another, with the amount dependent on your credit profile.
- Secured Loans: Secured business loans are also known as term loans and are meant to be used for acquiring capital assets or upgradation of infrastructure. To avail this facility, you need to mortgage an asset(s) with the lender and the maximum repayment period can again vary from one lender to another. The maximum amount available is dependant on the value of the asset mortgaged by you.
- Working Capital Loan: Unsecured working capital facility is ideal for you if your requirement is for short-term only and you expect to repay the business loan amount in full after realising the payments from your side. Usually, you can use the amount availed as a working capital loan to repay urgent expenses such as wages, salaries, taxes, payments etc. It is better to avoid creating capital assets with this option as the interest burden would be too much to bear.
- Overdraft Limit: This is an ongoing facility that is extended by financial institutions for their customers who enjoy a good credit history. You can not withdraw cash against this facility but can use it to repay your expenses or purchase material, e. expenses related to business. The interest is changed on a daily basis and you have to pay interest on a monthly basis while the principal can be repaid according to your convenience. The total overdraft limit available to you can be changed by your lender periodically.
- Machinery Loans: This is one of the most popular loans for business owners in Jaipur who are looking to enhance their production capacity and improve the quality of products. Machinery loan can be availed for purchase of machinery only, and the machinery must be hypothecated with the lender. Based on your credit profile the maximum repayment tenor for a machinery loan can extend up to 7 years.
- Debt Consolidation Loan: If you are running multiple high interest loans or business credit cards, then you can avail a debt consolidation loan to combine all your separate loans into one single loan with the lower interest rate. This option is ideal if the difference between the interest rate being served by you and the interest rate available in the market is more than 1%.
Unsecured business loans are an excellent option for you if you want to strengthen your business finances without stressing your cash flow. But do remember that you must only borrow as much amount as you require, otherwise the interest burden might be too much to bear for you. With the option of nil pre-payment charges, you can opt to foreclose the business loan to save on your interest expenses.