Business Loan In Bihar

Bihar, the state located in the eastern part of India is bordered by Nepal in its north, West Bengal in its north-east and the state of Uttar Pradesh in its west. 

Though agriculture is one of the most important mediums of income for the people of Bihar, there are even some industries coming up in recent times. Bihar is quite slow in its development, especially in the field of manufacturing with the majority of its population remaining below the poverty level. The economy of the state is struggling at present, but that does not mean you cannot avail of a Business Loan in Bihar. 

Of course, you have the option of availing Collateral Free Business Loan in Bihar through FlexiLoans. We can help you with the process of gaining a standing for your business in this state without going through any hassle.

How to Get Business Loan in Bihar?

For the majority of the businesses in Bihar, generating sufficient working capital for keeping procedures running can be quite challenging. In times when companies invoice their customers, they might have to wait for a minimum 920 days before receiving the payment for services and goods delivered. This might be very convenient on the part of the consumers, but it can put a lot of stress on the companies. One good alternative here is going for a term loan available from FlexiLoans. We are also into providing vendor financing that is simpler than working capital funding.

Our line of credit and loan against POS schemes have also proved to be of good help for businesses in Bihar. All businesses that need a small business loan in Bihar come to us for fetching their requirements. Our GST business loan in Bihar helps businesses in doing away with their financial challenges without worrying about the payment of GST taxes. FlexiLoans’ unsecured business loan in Bihar comes to the rescue of entrepreneurs who find it very difficult to manage collaterals for availing loans.

So, come to us, and we will be more than happy to help you set up your small or medium scale business in Bihar.

Benefits of Business Loans in Bihar

Business loans in Bihar, like in many other places, offer several benefits to entrepreneurs and business owners:

1. Financial Support: Business loans provide the necessary financial support for various purposes, such as starting a new venture, expanding an existing business, purchasing equipment, or meeting working capital needs.
2. Business Growth: These loans can fuel business growth and expansion, helping you tap into new markets, hire more employees, or launch new products or services.
3. Flexibility: There are different types of small business loans available, such as term loans, working capital loans, and equipment financing, each tailored to specific business needs.
4. Tax Benefits: The interest paid on loans for business is often tax-deductible, reducing the overall tax liability of the business.
5. Credit Building: Responsible repayment of a business loan can positively impact your business credit score, making it easier to access credit in the future.
6. Ownership Retention: Unlike seeking investors, taking out a loan allows you to retain full ownership and control of your business.

Applying for a Business Loan in Bihar

Applying for a business loan in Bihar online involves several steps. Here's a general guide to help you through the process:

1. Business Plan Preparation: Before you start the application, prepare a comprehensive business plan that outlines your business goals, financial projections, and how you plan to use the loan. Lenders often require this to assess your business's viability.
2. Researching Lenders: Research different lenders, including banks, financial institutions, and online lenders, to find one that suits your needs. Consider factors like interest rates, loan terms, and eligibility criteria.
3. Checking Eligibility: Review the eligibility criteria set by the lender. Common requirements for business loans in Bihar include a minimum business vintage (usually at least one year), a good credit score, and a certain annual turnover.
4. Gathering Documents: Collect the necessary documents, which typically include:
   • Business registration documents
   • KYC documents of the business owner(s)
   • Financial statements (balance sheet, profit and loss statement)
   • Business plan
   • Income tax returns
   • Bank statements
   • Address proof
5. Online Application: Visit the lender's official website and look for the online application portal. Fill out the online business loan application form with accurate information and attach the required documents.
6. Specifying Loan Amount and Purpose: Specify the loan amount you require and the purpose of the loan, such as working capital, expansion, equipment purchase, or debt consolidation.
7. Submitting Application: Review your application for accuracy and completeness. Once you're satisfied, submit it through the online portal.

The aforementioned steps will help you successfully apply for a Bihar business loan online! Now the lender will do a quick background check on you to confirm your credibility and then move forward to processing the loan.

Eligibility for a Business Loan in Bihar

Eligibility criteria for business loans in Bihar can vary depending on the lender and the type of loan you're applying for. However, here are some common factors that lenders typically consider:

1. Business Vintage: Most lenders prefer businesses that have been operational for a certain period, often at least one year. Startups may find it more challenging to qualify for traditional business loans. However, some lenders also offer loans that are specifically meant to fund startups.
2. Credit Score: A good personal and business credit score demonstrates your creditworthiness. Lenders usually look for a credit score of 650 or higher, but requirements can vary.
3. Annual Revenue: Your business's annual revenue or turnover is a crucial factor. Lenders often have a minimum revenue requirement, which can range from a few lakhs to crores, depending on the lender and the loan type.
4. Profitability: Lenders prefer businesses that are profitable or at least breaking even. They assess your financial statements to determine your profitability.
5. Loan Purpose: You must clearly state the purpose of the business loan. Common purposes include working capital, equipment purchase, expansion, inventory, or debt consolidation.
6. Legal and Regulatory Requirements: Ensure that you register your business and comply with all legal and regulatory requirements in your location and industry.

It's important to note that lenders may also assess your loan application on a case-by-case basis, considering factors like the economic environment and their own risk appetite. Therefore, it's advisable to research different lenders, understand their specific criteria, and work on strengthening your business's financial profile before applying for a business loan.

Types of Business Loans in Bihar

Here are some of the most common types of business loans that banks and NBFCs have to offer:

1. Term Loans: These business loans in Bihar provide you capital for a specific purpose, such as purchasing equipment, inventory, or expanding the business. They are typically repaid over a fixed period with regular instalments.
2. Working Capital Loans: These small business loans help you manage the day-to-day operations of your business, covering expenses like salaries, bills, and inventory. They provide short-term financial support and help maintain the smooth functioning of your business.
3. MSME Loans: Lenders have specifically curated MSME loans to support small businesses and entrepreneurs who may not have access to traditional banking services. They offer small business loan amounts and flexible repayment terms, making them accessible to a wider range of entrepreneurs.
4. Government Schemes: The government of Bihar, in collaboration with various financial institutions, offers several loan schemes in Bihar to promote entrepreneurship. These schemes often come with favourable interest rates, collateral-free options, and other incentives to encourage business growth.
5. Equipment Financing: Equipment financing is a type of business loan you can specifically use to purchase or lease equipment for your business. The equipment itself serves as collateral, making it easier for you to qualify for the loan.
6. Merchant Cash Advances: Merchant cash advances provide you with a lump sum of cash in exchange for a percentage of future credit card or debit card sales. Repayment is typically made through a daily or weekly deduction from the business's sales.
7. Line of Credit: A line of credit is a flexible financing option that allows you to borrow funds up to a predetermined limit. You can withdraw and repay funds as needed, paying interest only on the amount borrowed

Documents Required for Business Loans

In Summary

Bihar is a historically religious state that is now spreading its wings and growing stronger economically. With several opportunities now opening up for entrepreneurs, such as governments starting up schemes and financial institutions offering loans for businesses in Bihar, the conditions are certainly in the favour of businessmen. Business loans in Bihar are becoming a popular way of financing businesses and are here to stay.

Whether you are in Bihar, Delhi, or Kerala, FlexiLoans is here to provide you with the business finance that you need. With 100+ partners in 1000+ cities, our range of business loans is ready to reach you in any corner of the country. Our 100% online application process makes it possible for you to access "loans at a click"! FlexiLoans also boasts quick disbursal rates, so that you have finances available exactly when you need them. Apply now and start your journey of becoming an entrepreneur!

Frequently asked questions