A collateral is a valuable item, that the individual has to pledge for taking a loan. After paying back the loan, the collateral can be taken back, and if the individuals failed to pay the borrowed amount of the loan, then the collateral is kept by the bank or lender.
A collateral-free loan is a loan that is offered to the applicant without any guarantee. It is an unsecured loan, in simpler words, when the bank permits the individual to take funds at an attractive rate of interest without pledging any security or collateral.
Minimal documentation: - A collateral-free loan can be provided online with requires less paperwork. The necessary documents would be associated with KYC, Business proof, Address, Identity proof, etc.
High loan amount: - The applicant can take the loan amount up to Rs. 5 crores, depending on the profile and nature of the borrower.
Repayment tenure: - Several banks have many different schemes. The flexible repayment tenure permits the borrower to pay back the amount of the loan as per their financial potential.
Collateral-free loan: - Unsecured business loan does not require you to pledge any collateral for opting for the loan.
Competitive interest rate: - As compared to the other loan, unsecured business loans are provided at a flexible rate of interest.
Online process: - The borrower can access the loan at any time and anywhere without any hassle.
For identity proof: - (anyone)
For address proof: - (anyone)
|It has a flexible repayment tenure through which the individual can choose the tenure depending on their financial capacity.||If the borrower failed to pay EMI, then the collateral or security will be kept by the lender itself.|
|The borrower does not need to pledge collateral as a guarantee.||There is a high risk of possibility, as it is an unsecured loan.|
|It has quick approval, as the time spent on the verification is saved. Therefore, the approval of a loan is faster.||The documentation are minimal in range but it required some specific documents to be shared by the individual, failing to submit any of the documents might let to loan rejection.|
Given below are the easy steps to apply for a collateral-free business loan.
Step 1: - Visit the official website of your preferred lender and verify your loan eligibility online
Step 2: - With the use of business loan EMI calculator, you can know your monthly repayment
Step 3: - After checking your EMIs in advance , get started to fill the online application form
Step 4: - Enter all the necessary information and choose the required loan amount & tenure.
Step 5: - After filling in the form, click on submit.
Step 6: - Bank representative will check your eligibility and get in touch with you for further formalities.
To avail of collateral-free business loans, financeseva offers you to compare and choose the best deals from various lenders.
Also read: - External Commercial Borrowing (ECBs) - Overview