One of the top-notch private banking institutions, HDFC Bank started its operations in August 1994. Since its inception, it has evolved into a leading private bank in India. Headquartered in Mumbai, HDFC Bank introduces cutting-edge business loans to proprietors and self-employed individuals private limited companies, and partnership firms into the business of trading, manufacturing, and services.
Either it is the purchase of machinery or acquiring land. You can get a secure and collateral-both types of loan from HDFC Bank on different interest rates. The bank strives hard to allow you to meet your growing business needs through business loans with zero security involved in competitive interest rates.
HDFC Bank Business Loan Eligibility
If you are looking to avail HDFC Bank business loan, make sure you follow the following eligibility criteria;
Any self-employed individual, proprietor, partnership firm, or private limited company involved in trading, manufacturing, or services can apply for an HDFC Bank business loan.
You must be 21 years old at the time of borrowing and maximum of 65 years old at the time of maturity of the loan.
Minimum business turnover must be Rs. 40 lakh.
You must be associated with the current business for the past 3 years.
Your total business experience must be a minimum of 5 years.
Your business should be in a profitable state for the last two years.
The annual income of the business must be a minimum of 1.5 lakh.
Documents Required for HDFC Bank Business Loan
Here is a list of documents that are required to be submitted along with the application form as part of the application process for the HDFC bank business loan;
PAN Card is a mandatory required by the Bank to apply for business loans
Identity proof (Aadhaar Card/Passport/Voter’s ID/ PAN Card/Driving License)
Address Proof of the application (Aadhaar Card/Passport/Voter’s ID/ PAN Card/Driving License)
Bank Statements for the preceding 6 months
Audited balance sheet and profit and loss statement for the past 2 years with the latest ITR/Trade License/Establishment/ Sales Tax Certificate)
Mandatory documents like Sole Proprietorship declaration, a certified copy of partnership deed, certified true copy of memorandum and articles of association and board resolution
Features and Benefits of HDFC Business Loans
The HDFC Bank business loan allows you to meet your financial needs related to business. Is it moving into a new office, buying land, purchasing equipment, or getting a capital boost for future growth, a business loan empowers your business to continue its operations and progress at a rapid pace without the need of worrying about finance?
When a business is at the beginning stage, acquiring funds is often a problem. Getting investment for a business is tough, and it is where HDFC bank business loans come in.
HDFC makes sure to make the application process of loan easier and faster so you can avail it without any hassles. Here are some of the major features and benefits that make HDFC Bank business loan different:
· Collateral-free: Most of the business loans offered by the HDFC Bank do not involve any collateral, security, and guarantor, hence bringing you peace of mind.
· Amount of Loan Sanctioned: With the HDFC bank, you can avail of a loan of up to Rs. 40, 00,000 or even up to Rs. 50, 00,000 in selected locations. These loans are available without any collateral or any security.
· Tenure: Another great benefit of taking an HDFC bank business loan is that it provides loans for a flexible repayment period. You can easily avail of these loans for a period of 12 months to 48 months.
· Interest Rate: HDFC bank allows you to easily transfer their existing business growth loans from any other financial institutions of any other bank at very competitive rates. Presently, the rate of interest offered by the institution on approx 15.75% annum.
· Business Loan Balance Transfer: Business loan balance transfer allows you to transfer existing debts into a single consolidated business loan that is paid back at easy monthly.
· Processing Charges: Processing charges on existing loans that are transferred to HDFC business growth loans are quite nominal and charges are 0.99% of the loan amount.
· Dropline Overdraft Facility: The unique overdraft facility is a life-saver to maintain business growth. This limit is fixed in a separate current account that reduces on a monthly basis till the end of the tenure of the loan. The borrower needs to pay interest only on the amount of such an overdraft facility utilized. Such facility can be obtained for an amount ranging from Rs. 5, 00,000 to Rs. 15, 00,000. The best part is that HDFC does not need any guarantor or security for this facility. Under it, the borrower is not allowed the option for foreclosure or part closure of the loan amount in the first six months that such limit is fixed or facility provided.
· Credit Protect Option: HDFC does not only provide you with a business loan but also provide a credit insurance option. This scheme deducts the insurance charges from your loan amount and offers loan repayment protection cover so that your family does not have to take stress about the payment of outstanding loan amount in the event of accidental or natural death.
· Easy Access to Eligibility Check and Prompt Disbursal: With this feature, borrowers get the option to check their eligibility for the HDFC Business loans through digital banking or by directly visiting the branch of the Bank. The bank offers prompt eligibility checks of the applicants for its business loans in as little as 60 seconds that in turn allows them to get the loan at a faster rate.
FAQs for HDFC Bank Business Loan
Q. How to calculate Interest/EMI on Business Loan?
A. After your loan specifics are finalized, there are loan EMI calculators available online that you can use to measure your Interest and Principle breakdown each month and also keep track of the amount paid and the amount pending which can be useful when planning to repay the loan.
Q. How do banks calculate the EMI?
A. There is a formula used by banks to calculate EMI is mentioned below:
EMI = [PXRX (1+R) N-1], where P stands for the loan amount or principal, R stands for the interest rate
Q. How much business loan amount can I get from HDFC Bank?
A. The maximum loan amount that can be availed in form of a business loan is up to Rs. 75 lakh.
Q. Is there is any special facility for women and entrepreneur to get a business loan from HDFC Bank?
A. There is nothing special to avail loans. Women entrepreneurs need to simply fill in the loan application form online to apply for a business loan or any other type of loan.
Q. How can I negotiate the interest rate on my HDFC Bank business loan?
A. If you are an existing customer at the bank, and you have a good standing with the Bank with good credit score and cash flows then you can negotiate the interest rate and get it at better terms.
Q. How can I repay the HDFC Bank Business loan?
A. You pay the loan in equal monthly installments (EMIs). The loan will be paid through post-dated cheques. Also, you have the option to pay through Electronic Clearing System (ECS) or a standing instruction to debit your HDFC Bank account with the EMI amount
Q. What are the others options to pay my HDFC business loan EMI online?
A. You can pay EMI online through net banking, UPI to HDFC bank easily.
Q. What is a Cash Credit account in HDFC bank?
A. A Cash credit account is a kind of overdraft facility offered by HDFC bank to its customers to meet their working capital needs. Cash credit is basically a short-term loan offer on the basis of the credit history of the applicant.
Q. What is the usual interest rate for business loans in India?
A. Generally, the rate of interest for a business loan varies from 10% to 21% in India. The exact rate of interest will vary from bank to bank depending on the eligibility criteria defined by the bank.
Q. How can I get an HDFC Bank business loan?
A. You can get a business loan from HDFC online by applying for the loan at https://www.hdfcbank.com/personal/borrow/popular-loans/business-growth-loan. If you do not want to go through the online process, you can directly visit the branch for the offline loan process. Just make sure that you fulfil the eligibility criteria as given by the bank and present the required documents to get your loan application approved.
Q. How can I check the HDFC Bank business loan status?
A. You can easily check the HDFC Bank business loan status by reaching out to the customer care number or if you already have an account can log in to your account and check the status there. You can also check with your account manager if you have been allotted one.
Q. How can I avail overdraft facility from HDFC bank?
A. In order to avail overdraft facility in HDFC bank, you should have a current or savings account with the bank for the last six months. Besides, if you should have a good relationship with the bank, you can easily apply online or via visiting the nearest bank branch.
Q. What is the process to avail of a collateral-free MSME loan from HDFC bank?
A. To avail collateral-free MSME loan from HDFC bank, you can apply for unsecured business loans up to Rs. 75 lakh or can apply for loan schemes initiated by Govt. of India, like Mudra loan under PSB loans in 59 minutes, PMMY, CGTMSE, PMEGP, etc.
So this is all about HDFC bank business loan, process, interest rate, documents required and related FAQs. Hopefully, you found this post helpful. Subscribe to The CEO Magazine to get all the latest updates in your inbox.