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What is Business Loan


         Business Loans are unsecured loan provided by Banks & NBFCs to support business of the people. It’s a credit facilities provided by Banks to fund a startup expenses or expansion of existing business. There are different types of business loans used for different kinds of needs of different businesses such as Working Capital Loan, Business Term Loan, Startup Loan, E-Commerce Business Loan, Invoice Financing Equipment Financing, Overdraft etc.

Benefits of Business Loan

Business Loans as compare to other loans has its own features and benefits

Interest is Tax Deductible

Interest which you pay on business loan is tax deductible. Since it is an additional amount paid by you to the bank which is paid out from your profit or income, it is eligible for a tax benefits.

Minimal Documentation

Unlike other loans, to get business loan you don’t need much documents to get the loan therefore it is easier and quick to get the business loan. Moreover, some banks offer door step services also.

Competitive Interest Rate

Since there is intense competition among banks to grow their own business, the interest rates are quite reasonable but interest rates may vary customer to customer basis depends upon credit worthiness, tenure and the purpose for which the loan is needed.

Collateral Free Loan

The Business Loan is an unsecured loan which means that the borrower does not have to provide any security or guarantee documents to the lenders but the property or land must be owned by the borrower to get 100 percent loan disbursement. 

Business Loan Eligibility

Every Bank or NBFC providing business loan have different eligibility requirement and needs. Still there are some common criteria for all the Banks & NBFCs. Before applying it is advisable to check eligibility on Eligibility Calculator.

Documents - Business Loan


Points To Compare Before You Apply Personal Loan

Compare Interest Rates

It is always good to compare the offers of various Banks and NBFCs before you settle for one. Check and compare the interest rates on personal loan offered by various Banks and NBFCs to get the best and cheapest interest rates on Loans4Dreams.Com. Most banks offer completely fixed rate of interest for the entire tenure of the loan. Make sure that the personal loan that you are taking is also fixed for the entire tenure.

Processing Fees

Compare various banks processing fees on the business loan they offer. Most of the banks have processing fees ranging from 0.5 % to 3 % of the loan amount. Higher processing fees can result in significantly high cost on loan hence, it is important to compare rates for business loan on Loans4Dreams.Com and select the best offer.

Insurance Premium

Some banks may request you to get the insurance policy as it is an unsecured loan. Get the insurance policy which gives you adequate coverage at lowest premium.

Compare Prepayment and Foreclosure Compare Prepayment and Foreclosure

Everyone wants to repay his loan as soon as possible. Sometimes, you want to repay part of the loan i.e. part prepayment or you may want to repay entire loan amount before tenure. Banks levy prepayment or foreclosure charges ranging from Nil to 5 %. Hence, it is important to compare prepayment and foreclosure charges of various banks on Loans4Dreams.Com


Generally, processing fees for the  business loan is 1-3 percent of loan amount

The Tenure of the business loan may vary from period of 01 month  to 60 months

Some banks allow pre closure at no cost and Some banks levy pre closure charges between 2 to 5 percent of loan amount

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EMI can be made on a biweekly or monthly basis

Generally, the minimum amount is 50 thousand rupees and maximum loan amount is 2 Crore rupees which may be extended depends upon customer profile.


BankBusiness Loan Interest RatesProcessing Fee
SBI Business Loan11.20%From 2% to 3%
HDFC Bank Business Loan15.65%Starting from 0.99%, Max 2.50%
ICICI Bank Business Loan16.49%Starting from 0.99%, Up to 2%
Citibank16.00%Upto 2%
RBL Bank16.25%1.80-2.20% of loan amount
Tata Capital19.00%From 1.50% to 2.50%
Lendingkart12.00%2% of loan amount
Bajaj Finserv18.00%Upto 2% of loan amount
IDFC First Bank22.00%2.00%
IIFL16.00%Up to 2%
Bank of Maharashtra14.50%1.00% of loan amount, Min Rs. 1,000
IndusInd Bank14.00%2.50%
Kotak Bank16.00%Upto 2%
Fullerton India17.00%2%
Indifi24.00%2 to 3%
Neogrowth19.50%2.5% of loan amount
IDBI Bank12.25%1.00%
Allahabad Bank11.15%Rs. 229 - per lac, Min Rs. 2,038 Max Rs. 22,928
Yes Bank16.25%Up to 2%
PNB12.65%1.8% + taxes
OBC11.40%0.50% of Loan Amount
Indian Overseas Bank14.90%Rs. 204 per lakh
Dhan Laxmi Bank12.90%
DCB Bank10.70%2%
Andhra Bank15.75%Case to Case
United Bank of India13.00%1.15%
Corporation Bank13.55%1.5%, Min Rs. 500
Syndicate Bank12.65%0.5%, Min Rs. 500
Bank of Baroda14.10%Upto 1.00%