Whether Business scale is small or large, Working Capital is essential part & need of every business. What happens when your business face working capital shortage? Have you ever imagined to tackle the situation!
Most probably due to shortage of Working capital you would face issues like collapse in management, unable to take care of existing projects & future orders, & liabilities get increased.
Lastly, left with the ideal option of Applying for Working capital loan to strengthen your business. Some of the top factors determine your working capital loan approval given in followings: -
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Selected Loan Amount: - One of the major factors that determines your loan approval is selected loan amount. The amount you require to fulfil your requirements should not exceed then specified amounts.
Justify Spending: - As the factor itself states justify spending which means you need to justify your loan borrowing amount that on what, how & why you are going to spend it with mentioning repayment structure.
Tenure Period: - Tenure period defines how long you need to repay principal amount. In fact, Lenders prefer approve borrowers who opt for longer tenure periods as it gives relief to pay smaller EMI which lesser the payment defaults & sufficient time to repay amount.
Companies Age: - Its often lenders want to know years of company existence so that it helps to evaluate Business cash flow efficiency. For example, newly issued company unable to show profit & loss statement due to non- statement lenders don’t able to identify creditworthiness of company while minimum more than 3-year-old company have sufficient company records & could show data to get verified creditworthiness.
Collateral/Security: - Whether loan for new or existing firm in both security is must require things. Lenders prefer to fund applicants Working Capital Loan Interest Rate who are ready to pledge their security to get loan as it seems to have lower risk.
Above mentioned 5 top factors are determined to evaluate your working capital loan approval, make sure you take a look of these points to score well in your loan application. Try each possible way to understand lenders concern on application
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