How To Grow Your Small Business This Festive with Business Loan

  • During the festive season, sales and purchases remain at an all-time high. Business owners are therefore compelled to increase production in their businesses to meet this higher demand. As a result, some additional equipment and machinery will need to be gear-up for the production increase.
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Published on Sep 29, 2021 09:20 PM IST
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ByHT Brand Studio

The number of small and medium-sized businesses has increased in recent years. As far as popularity and economic significance go, they have demonstrated promising growth. In addition to this growth, there was an increase in competition as well.

Now, more and more Small and Medium Enterprises are employing new strategies to differentiate themselves from their competitors. A slew of new business loan schemes has resulted from this development. An important source of capital for small businesses is business loans.

There are two forms of loans that SMEs can use to acquire capital today: business loan and SME loan. They differ in some ways and look similar in others; however, their purpose is to satisfy the business's desire to acquire assets.

Businesses benefit from these loans in many ways. The obvious benefit of loans is that when used effectively, they can substantially multiply the earnings of a business. Correct timing of the markets is a crucial element of this skill.

Loans for business, the festive season, and more

The holiday season is the perfect time for a market to thrive. Business sales are at their peak during this period and earnings spike. Small and medium-sized businesses are especially well off due to the rise in demand in the market because they can exploit the sales and profit accordingly.

However, why would businesses take out a loan during the festive season?

This question has a straightforward answer. When business owners have invested all of their finances into the business, their business is more at risk than any other business. Small and medium businesses are the hardest hit by market fluctuations. Capital can be gradually drained from the owner in this way. In addition to providing capital aid, a business loan and SME loan can protect the business owner's assets in the event of a downward business fluctuation.

There is also a boost in demand for products and services during the festive season. During the festive season, sales and purchases remain at an all-time high. Business owners are therefore compelled to increase production in their businesses to meet this higher demand. As a result, some additional equipment and machinery will need to be gear-up for the production increase. This can be addressed with a business loan. A business owner does not need to invest from their own funds to obtain an SME loan or a business loan.

Different SME sectors and the festive season:

Different SME sectors are affected by the festive season in different ways:

Retail: Demand for electronic products increases during the festive season, when shoppers are looking to buy new gadgets. Small and medium-sized enterprises in the retail sector can therefore benefit from expanding their production during the festive season. In order to increase the production budget of retail businesses and use it for advertising and commercial marketing, they can obtain a business loan.

E-commerce sector: The holiday season certainly brings with it a great deal of volatility. In an extremely competitive market such as the e-commerce one, companies offer sales and thus require bigger productions. An increase in production can lead to increased expenses, so acquiring a financial fund can assist the business owner in paying such costs.

Hotel and restaurant businesses gain a marginal boost during the festive season because people go on vacations. The increased load of customers required by this sector will also benefit from SME loans.

Industrial segment: During the festive season, the demand for commodities rises in the major market, as well as in the wholesale market. For the higher demand, it is imperative to have some extra capital. As a result, business loans are beneficial during peak seasons like festival season.

It is evident from the trends in these sectors that SME loans are the agent needed to make the sector thrive and capitalize on profits during the holidays.

Business Loan: The ideal boost for your business during this festive season!

If you are a small business owner and you are looking to expand your business’s productivity and earnings, then the festive season is the right time to shine. You can make the most of the festive season by applying for an SME business loan. NBFC like Ziploan which offers quick business loan within 3 days* at competitive interest rates.

Features of an SME/Business Loan:

The salient features of the SME loan are described below:

The SME loan is designed to provide financial assistance to small and medium businesses.

The repayment period of a business loan is usually short. NBFCs and banks offer three-year loans as an average.

SMEs are not required to provide collateral or mortgages as a prerequisite for loan approval.

A prepayment penalty is also applicable to some SME schemes if the loan is returned before the repayment period is completed. Depending on the lending institution, this feature may differ.

The starting rate for SME loans is Rs.50,000.

A secured business loan has a lower interest rate than an SME loan.

Festive Season Benefits of SME/Business Loans:

The availing of business loans during the festive season offers the benefit of optimizing sales for your business. Small businesses benefit from it financially. Therefore, the owner has the option of expanding production without any hesitation.

In addition to tax exemptions, SME loans provide business owners with deductions from the business's taxes.

SME loans are also offered by several lending institutions with additional cash benefits for business owners referring other owners to the institution's SME program.

Business owners can increase their assets and equipment through SME loans.

Businesses can avail themselves of business loans without having to put their personal or business assets at risk to get approval.

As these loans' policy periods are short, they are useful for fulfilling short-term goals for a business. Especially during holiday seasons, when business sales are at their peaks, this is an advantage.

A SME loan application is a quick and easy process. Due to the lack of collateral, these loans are less complicated to apply for.

How to apply for a business loan:

It is easy to apply for a business loan. Applying for an MSME loan online is also possible. The following steps can be followed by an eligible candidate:

Offline Method for application:

Go to the bank or NBFC where you wish to apply for the loan.

Fill in the loan application form.

Complete the application with all required documentation.

After the loan application has been verified, it will be approved.

Applicants can apply online:

Visit the official website of the lending authority after selecting the SME scheme that best suits your business goals.

Complete the loan application form for the SME scheme of your choice.

Please enter your application credentials.

Attach the necessary documents to the application to verify the information.

The application proceeds to verification once you have submitted the application form and paid for the additional application fee.

The loan will be sanctioned if the application credentials are authentic.

Documents required for applying for SME Loan:

Proof of identity: Aadhaar Card, Voter ID, PAN, or Driver's license is acceptable identification.

Valid documents for verifying a candidate's residential address are Aadhaar Cards, Voter IDs, and utilities bills such as electricity bills and telephone bills.

Disclaimer: This is a company press release. No HT journalist is involved in creation of this content.

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Thursday, December 09, 2021