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Business Loan Interest Rates

Business Loan is a handy financial product for business purposes. You can opt for business loan to set up a new business venture, increase the working capital, purchasing new equipment and inventories or expanding the business. Before you go for a business loan, the first and most important thing to consider is business loan interest rates in India. For higher business loan interest rates, you need to pay higher business loan interest rates amount and for a lower business loan interest rates, you will have to pay lower business loan interest rates amount. So, it is always better to go for business loan interest rates comparison using business loan interest rates calculator which will provide you with the details of business loan interest rates compare of different financial institutions. To calculate the loan interest rates for business, few details are considered such as- monthly income, annual turnover, credit score, etc. Usually, business loan lowest interest rate starts from 13.50%*. But business loan interest rates lies between 14.99%*-24%* on an average. To protect the small and medium enterprises, government business loan interest rates are also available which are quite low. Whether you started a new business project or wants to grow the existing one, you can opt for new business loan interest rates or large business loan interest rates respectively that are offered at a lower rate.

How to compare Business Loan Interest Rates of all financial institutions?

When you are planning for business loan, it is always better to check the loan interest rates for business beforehand. When you check business loan interest rates today using business loan interest rate calculator India, you will get business loan interest rates all banks details. Then you can efficiently choose business loan lowest interest rates to fulfill your business needs. Along with interest rates, some other charges should also be checked.

  • Processing Fees

    The processing fee of business loan is a very important factor to consider which is charged by the financial institutions to process the loan amount. Usually, the processing fee lies between 2% to 3%. But if it exceeds more than that, then it is better not to take that loan. This is because you need to pay this extra amount along with business loan interest rates. Though the loan interest rates for business might be low, but higher processing fee that is non-refundable will increase your cost.

  • Prepayment Charges

    To prepay the business loan before the tenure, you need to pay a prepayment charge. But if the prepayment charge is quite high, then a lower business loan interest rates will not be helpful. As you will have to pay higher prepayment charge to foreclose the loan apart from lower business loan interest rates.

Business Loan Interest Rates of all financial institutions

Financial Institution Business Loan interest rates Processing Fees
Business Loan interest rates of ICICI Bank 16.49%* 0.99% to 2%
Business Loan interest rates of HDFC Bank 15.65%* 0.99% to 2.5% of the loan amount. Maxuimum of Rs. 88500 and Minimum of Rs. 2359
Business Loan interest rates of Bajaj Finserv 18%* Max 3%
Business Loan interest rates of Axis Bank 14.50%* Up to 2.00%+applicable taxes
Business Loan interest rate of IDFC First Bank 11.69%* Up to 2%
Business Loan interest rates of IndusInd Bank 14%* Up to 2%
Business Loan interest rate of Tata Capital 18%* 1.50% to 2.75% + GST
Business Loan interest rate of IIFL 13%* Up to 2%
Business Loan interest rates of Kotak Bank 16%* Max 3%
Business Loan interest rates of Fullerton India 13%* Up to 6.5%
Business Loan interest rate of Yes Bank 15.5%* Up to 2%+GST

*Interest rates change time to time.

Which factors affect Business Loan Interest Rates?

For a lower business loan interest rates, you must apply for a business loan at an early age with a good credit score.
Here are some of the factors which affect business loan interest rates-

  • Age

    Business Loan interest rates get highly affected by the applicant’s age. The minimum and maximum age limit lies between 21 to 65 years for lower Business Loan interest rates. Applying for Business Loan at a young age will lower your Business Loan interest rates. Moreover, you will get attractive offers and benefits. But Business Loan interest rates will be high for an older applicant.

  • CIBIL Score

    Your CIBIL score really affects Business Loan interest rates. If you have low CIBIL score, then your Business Loan interest rates will be high but if your CIBIL score is high, then Business Loan interest rates will be low. Proper repaying habit will give you high CIBIL score which will lower your Business Loan interest rates.

  • Existing Debt

    If you have any existing financial liability of paying credit card bill dues or EMI of different loans, then your Business Loan interest rates will be high. And if your existing debt payment consumes almost 40% of your monthly income, then your business loan interest rates will be high because your repaying capacity gets reduced because of your existing liability. So, it is always advisable to either pay off the ongoing debts or opt for balance transfer and go for a top-up loan. This will lower your Business Loan interest rates.

  • Business Stability

    For a lower Business Loan interest rates, you must possess a stable business with a minimum experience of 3 to 5 years. Also, the business must generate profit for the last 3 years and 10% to 15% growth in the last 3 year’s turnover which will lower Business Loan interest rates.

  • Housing Situation

    Your housing situation is an important factor which affects business loan interest rates. If you stay in your own house, then your Business Loan interest rates will be low. But residing in a rented house will increase your business loan interest rates as your repaying capacity will get reduced. Business Loan Interest Rates will be low if you have your own work place.

  • Geographical Location

    The geographical location of your stay hugely affect Business Loan interest rates. If you stay in a metropolitan city, your Business Loan interest rates will be low. Whereas if you stay in a rural area, then your Business Loan interest rates will be high. Also, there are some red marked areas as pointed by the financial institutions. So staying in red marked places will also increase your Business Loan interest rates.

  • ITR

    Business Loan interest rate gets really affected by the ITR file. You must submit ITR details of the last 3 years and updated bank account statement of last 6 months for a lower business loan interest rates.

FAQ's

For a business loan, you do not have to keep any security with the bank. So, business loan interest rates are high.
The minimum credit score for business loan interest rate is 750 or above.
You can use a business loan to buy new equipment, increase the working capital, buy inventory stocks, set up a new business venture and expand the business.
The minimum interest rate for a business loan is 14.99%*.
The minimum and maximum loan repayment tenure for a business loan are 12 months and 60 months respectively. Business loan interest rate will be low for a shorter loan tenure.
*Interest rate and Loan approval are subjected to band discretion and approval.

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