Business loans are unsecured loans made to professionals such as chartered accountants, business secretaries, and physicians, who provide professional services by charging specific fees. Experts say these loans are designed for expansion, upgrading, or any other business requirement that may arise.
Manish Chaudhari, Head of Digital and Enterprise Alliance at Poonawalla Fincorp, says: “Professional loans are granted to certified professionals such as doctors, chartered accountants and corporate secretaries. However, lenders verify eligibility and other identifying information as part of the background check process before granting a loan to an individual.
Business loans are unsecured loans in which the borrower does not have to give collateral to the lender when obtaining a loan.
How is it different from a personal loan?
Unlike business loans, personal loans are given to people who need money to meet personal needs such as vacations, wedding expenses, home improvement and sometimes for any medical requirement. Industry experts claim that personal loans can be chosen by anyone, such as an individual who is either a salaried employee working in any organization or a self-employed person who has their own business and needs money to meet their needs. personal needs.
Chaudhari says, “The main advantage of a business loan is that it does not require any collateral with the lender as collateral. Moreover, such a product can be used in a completely digital way without the need to physically visit the branches of the lender.
The interest rate for business loans typically ranges from 9.99% to 12%, depending on the respective lenders. “An important point to keep in mind is the loan limit that can be used for business loans,” Chaudhari adds.
Is it ideal to take out a professional loan?
“Professionals, like anyone else who works hard, aspire to growth in their profession. Capital requirements are necessary for various reasons such as office expansion, renovation, additional staff, purchase of new equipment to improve work efficiency, etc. Explains Chaudhari.
He further adds: “In the past, these loans required them (professionals) to attach certain physical / tangible assets that have monetary value to the lender / financial institution to qualify for loans for their needs.”
Attractive lower interest rates, flexible loan term, low processing fees and a fully digital platform make these types of loans ideal for securing transparent and fast channels for professional growth. .