Businesses need funds to grow from time to time. Whether it is to expand the production or to invest in new technology, you will need funds at every stage of growth. All business owners have aspirations to take the business to new heights and you need funds to achieve the same. There are two types of loans available in the market-one is a secured loan where you need an asset as collateral and the other is a loan without collateral. It is also known as an unsecured loan. The loan works best for those who do not own an asset or are not willing to hypothecate the asset with the lender. The loan amount will be based on your profile and credit history. When you choose a lender, you need to compare the eligibility criteria and interest rates offered by them. Let us take a look at the benefits of applying for an unsecured loan.
- Low risk: A huge advantage of applying for a loan without collateral is that you do not have to bear the risk of losing your asset in case of nonpayment of dues. It is extremely important to pay the EMIs in time but if you fail to do so, you will not lose your asset. The risk lies with the lender.
- Quick approval: Since there is no need for hypothecation of the asset, the loan processing, and approval is quick and hassle-free. There is no need to submit the documents of hypothecation and the lender does not need to hire a market valuer. This saves time and you will get quick approval.
- High loan amount: An unsecured business loan has a high loan amount and it is based on your profile, repayment ability, and viability of the business. This means you can get access to funds from a single lender that will fulfill all your needs.
- No specific end-use: With an unsecured loan, there are no conditions in terms of the end-user. You are free to use the funds for the business and you do not need to inform the lenders about it. You can invest in a new business opportunity, invest in new technology, or hire skilled personal. No matter where you want to use the funds, you are free to do so.
A loan without collateral is a preferred choice of many and it helps reach business goals. The loan application procedure is simple and hassle-free. It is preferred by lenders because there is no need for hypothecation of the property and there is minimal risk. You can use a repayment schedule to plan the cash flow and ensure regular and timely repayment.
Use the EMI calculator to get an insight into the monthly installments you will have to pay. The calculator is available online and it will give the right answer to your question. It will determine the EMI based on the loan amount and tenure your input. A loan without collateral can help take the business to new heights and will serve your financial needs. Consider all the lenders available in the market and make your borrowing decision.