The  types of business loans are as follows.

Working Capital Loan Available to any businessman engaged in the service industry, manufacturing industry, retail industry, wholesale industry, or import/export industry.

This plan is typically selected when a company is experiencing a liquidity shortage due to irregular cash flows and needs funds to cover the company’s ongoing operating costs, or when there is a sudden increase in business volume will be done.Working capital financing can be provided through lines of credit, overdrafts, packaging credits, postal credits, or non-fund-based lines of credit such as bank guarantees and letters of credit.

This is a revolving payment system that you can use whenever you need it. Once the company’s cash flow improves, you can replenish the spent amount with deposits.The biggest advantage of this type of loan is that interest is charged only on the amount used and  the period of use.

Interest rates are primarily based on a company’s credit rating. Working capital loans have a term of 6 to 12 months and are renewed after an annual review. The most important collateral for working capital financing is the shares and bonds of the company/company. Collateral  may  be required through a mortgage or commercial loan. This varies depending on the financial institution and loan amount.

Term Loans These loans are primarily provided for capital investments of a long-term nature. This could include building a factory site, improving infrastructure, or upgrading existing structures. Since the loan amount for this facility is large, it will be repaid in one lump sum. The repayment period will also  be longer, from 7 years to 20 years. Interest rates vary depending on the company profile, credit rating, loan amount and term.

The primary collateral is the asset created by the loan, and the collateral is a  residential/commercial loan. To apply for this type of loan, you must provide detailed project and procedural rules for the use of the loan amount.

Invoice Financing This is a very advantageous way of arranging financing for your business. The period from invoice issue to final payment may take 60-90 days. During this period, companies may face a liquidity crisis and  need funds for day-to-day business operations.

Banks/financial institutions  provide financing on such invoices to customers with whom they have a long-term relationship and have availed satisfactory credit facilities. Up to 80% of the  invoice amount will be provided as working capital  and the remaining 20% ​​will be provided upon receipt of final payment. For invoice financing, fees and interest will apply according to the lender’s guidelines.

Equipment financing is popular in the manufacturing industry. All manufacturing companies require essential equipment to produce their products. This equipment is financed by a bank/financial institution. We can finance office equipment, healthcare equipment, medical equipment, construction equipment, and more. In some cases, the amount raised can exceed 100 million yen. Funding is related to the project. Since the amounts are generally high, the interest rates are very competitive.The repayment period is 3  to 7 years. Assets resulting from a loan carry collateral, and residential and commercial real estate requires collateral  on a case-by-case basis.

 PMMY
Pradhan Mantri Mudra Yojana was set up to promote entrepreneurship in the MSME sector and  create employment for the youth of the country. Loans are provided to both  service and production sectors. The  loan amount ranges from Rs 50,000 to Rs 10 million depending on the industry.

 Stand Up India is set up to facilitate new business creation by candidates belonging to Scheduled Castes/Scheduled Tribes and to encourage women entrepreneurship.Entrepreneurs belonging to Scheduled Castes/Scheduled Tribes or  women entrepreneurs must hold majority stake in the enterprise/company to be eligible for funding under this scheme.