How to Get an Unsecured Business Loan in India Without a Personal Guarantee

Keywords: Business Loan Online, Business Loan Apply, Business Loan

Every growing business needs financial support, but many owners hesitate to apply for a loan due to strict criteria and risk of losing their valuable assets. Fortunately, many online lenders in India offer business loans where there is no need to pledge an asset as collateral and even a personal guarantee. 

If you are looking for a hassle-free loan approval for your business, then here’s everything you need to know.

Understanding an Unsecured Business Loan

Unsecured business loans are specifically designed to allow applicants to borrow money without providing assets as collateral or a personal guarantee. Unlike secured loans, where approval is based on the collateral, lenders approve unsecured loans based on your credit score, business performance, and financial history. These loans are a good option for startups, small businesses, or early-stage entrepreneurs.

Benefits of Taking an Unsecured Loan for Business

Here are the reasons why many business owners prefer applying for unsecured loans for business:

• There is no need to risk losing your valuable assets and a personal guarantee isn’t required.

• The process of unsecured loan approval is quicker as it doesn’t include the assessment of assets.

• There is no restriction on the usage of loan funds, and applicants can use them for multiple purposes.

• When applying for a loan for a business online, many lenders don’t require you to manage lengthy documentation.

Steps to Apply for Unsecured Loans for Business Without a Personal Guarantee

Follow the steps below to successfully apply for an unsecured business loan online without a personal guarantee:

• Compare the Lenders: Do your research and compare the terms offered by different lenders online. Consider comparing factors like rate of interest charged, repayment tenure, processing fee and approval time taken by the lender.

• Check Eligibility Criteria: Before proceeding with the application process, make sure you check the business’s eligibility criteria. Some of the basic requirements include a good credit score (potentially more than 650), a business must be 2-3 years old and profitable for at least 1-2 years, the applicant must be at the age of 21 years, and the business must have stable financial statements.

• Documentation: Gather all the necessary documents, including PAN card, Aadhar card, bank statements, ITR, GST registration and more.

• Apply Online: Create your account, fill out the business loan apply form and upload all the necessary documents. Ensure that you double-check all the information provided and submit the request.

• Disbursement of Funds: Once your application is approved, the funds will be transferred to your bank account.

Factors to Improve Your Chances of Loan Approval

Consider the following factors to increase your chances of getting quick loan approvals:

• Maintain a good CIBIL or credit score. Ensure that you repay all your debts and avoid applying for too many loans in a short period of time.

• Provide a clear track record of your business including successful operations and consistent revenue growth.

• When applying for business loans, outline how you intend to use the funds and mention your strategy.

• Show a detailed business plan, including the market research, target audience, and expected revenue.

Final Thoughts

Getting an unsecured loan for business without a personal guarantee is quick and straightforward, once you have gathered all the necessary documentation and meet the eligibility requirements. 

When applying for a quick business loan online, ensure that you use trusted and reliable lenders like Bajaj Finserv. Bajaj Finserv is a one-stop and easy-to-use platform for seamless loan application. It offers benefits such as 100% online loan application, no collateral, flexible tenures, and no hidden fees.

So, what are you waiting for? Apply for a loan online without any worry of providing collateral and take your business to the next level.