10 Things to Know About GST Business Loans

Mumbai, November 22, 2021

A GST business loan can be a convenient option to get your hands on much-needed liquidity. After all, the loan offers a high-value amount at affordable interest rates.

What to know more about these loans? Here are ten things you should consider before applying.

1. Type of loan

A GST loan is a type of unsecured business finance. This means you can apply for one without pledging collateral, which is a plus if you have limited assets in the first place. Moreover, you can access funds whenever you need them.

2. Eligibility

Most business entities, including private limited companies, public limited companies, partnerships, sole proprietorships, etc., can apply for these loans.

What’s more, the business loan eligibility primarily depends on up-to-date GST returns. Lenders also look at the period you’ve run your business and monthly sales before approving your application.

3. Loan purpose

GST loans are typically multi-purpose loans you can secure for all your business needs. So, whether you need funds to manage your working capital, equipment purchase, cover manufacturing costs or plan our business expansion, a GST loan can cover it for you.

4. Loan amount

When you apply for a GST loan, you can get loan amounts of up to Rs. 1 crore to meet all your immediate business financial requirements.

5. Interest rates

The business loan interest rates on GST loans vary from lender to lender, but are usually on the lower end. Additionally, a given lender may also offer different interest rates depending upon the loan amount required, your GST returns and past sales. Thus, it is best to compare the interest rates of different lenders before applying.

6. EMIs

Given the nominal interest rates, the EMIs on these loans are generally affordable. Most lenders also offer flexible EMI repayment options to make the process easier for borrowers. Besides, if you need help estimating the payable EMIs before applying, you can use a business loan EMI calculator and choose your preferred lender.

7. Documentation

Lenders ask for your PAN card, proof of residence, bank account statements, GST registration certificate when you apply for a GST loan. In the case that you require loan amounts over Rs. 20 lakhs, you might also require audited financial statements, ITR details, GST returns, etc., while applying.

8. Faster loan approvals

Thanks to the government's online application portal, you can receive approval for GST loans within an hour. This makes loan approvals contactless and automated.

9. Quick disbursals

If you’re in need of instant funds to relieve immediate financial stress, a loan with quick disbursal time like a GST business loan can help. This means there are no unwanted delays, and better yet, no loss of business opportunities either.

10. Online process

The government portal also allows you to apply for the loan online, provided your business is over a year old and has monthly sales of over Rs. 2 lakhs. All you need to do is fill in the relevant details and uploadthe documents to apply.

As you can see, GST loans are excellent avenues for raising business funds. So, why wait? Check your business loan eligibility today.

(Readers are advised to exercise due diligence and discretion before entering into any correspondence, investment, purchase, business dealings or any other decision on the basis of this content.)

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