A personal loan for business can be taken to meet the financial or the working capital requirements of the business, to buy inventory, start a new product line, or business expansion.
The approval of the loan depends on the CIBIL score of the borrower as it will determine the creditworthiness of the borrower.
CIBIL score is an important criteria for availing a loan.
But it is not always possible that the borrower has a high CIBIL score, therefore he looks at other ways to take a loan. Although the CIBIL score is very important, a personal business loan can still be obtained with a low CIBIL score.
How you can avail a personal business loan with a low CIBIL score?
1. Check your CIBIL score for any mistakes
Sometimes a low CIBIL score can be because of some wrong transaction or entries in your credit history. This can affect the credit score. Therefore, it is necessary to check for any errors in the report. And even if there are, it is important to get them corrected immediately.
2. Prove your income
A personal loan with a low CIBIL score can also be obtained if you show your income from additional sources like rent, salary, commission, etc to prove that you can pay for the EMIs.But usually, loans with low CIBIL score are offered at high interest rates.
3. Involve a guarantor
You can also involve a guarantor for the business loan if any person is willing to do so. If the guarantor has a good credit score and a stable income, the lender will grant you the loan.
4. Apply for a small amount loan
If you apply for a high loan amount, chances are that it might get rejected. A high loan amount with low CIBIL score indicates financial instability and is a risk for the lender. But if you apply for a low loan amount, it will be less risky for the lender and granting a loan will be easy for the lender.
Before you approach any lender, do research on the eligibility criteria and the other terms and conditions first.
If you want a loan for your small business at an affordable interest rate, contact Gromor Finance!