If you are planning to apply for a small business loan, make sure you first consider these factors that influence the business loan interest rate!
- Type of Lender: Different types of lending institutions will charge different rates of interest, such as banks, NBFCs, and institutions similar to NBFCs.
- Credit Score: If a business owner has a good credit score, the lender may be willing to offer a better deal in terms of the interest rate.
- Type of Business: Certain industries are riskier than the rest. This will also be taken into consideration by a lender, to determine the interest rate.
- Financial Health: How long the business has been active and the financial health of a business, as is evident from the balance sheet, P&L account, cash flow statements, etc. will also matter when it comes to determining the interest rate.
- Collateral/Security: Based on whether the lender offers the loans against security or without it, the business loan interest rate will differ.
If you’ve considered these factors, and are looking for a small business loan, get in touch with Gromor Finance!