Flexiloans Business Loan Eligibility

We will discuss what are the Flexiloans business loan eligibility criteria. We will also lay out the documentation needed, the types of business loans and their eligibility criteria, how business loan eligibility is calculated, and how it can be improved.

Eligibility Criteria for Flexiloans Business Loans

Parameter	Eligibility
Age	21-65 years
Who can apply?	SMEs, sole proprietorships, MSMEs, retailers, traders, individuals, partnership firms, private and public limited companies, and manufacturers engaged in only the trading, service, and manufacturing sectors
Years in business	Minimum 1 year of profitable business
Business experience	Minimum of 2 years at the same business
Annual Turnover	Minimum of Rs. 10 lakhs and above
CIBIL™ score	650+
Nationality	Indian citizens with no previous default history
Additional criteria	Applicant must have a shop, office, home, or godown

 

Documentation needed for Flexiloans Business Loans

Parameter	Acceptable proof
Identity proof	PAN card
Residence proof	Driver’s license, voter’s ID, rent agreement, Aadhaar card, passport, ration card
Income proof	Past 6 months’ bank account statements
Business proof	Shops and establishment certificate, GST registration certificate
Finance documents	Previous 2 years of ITR, 6 months of GST returns, previous 2 years of audited financials

Maximum Business Loan Eligibility 

The maximum loan that the applicant is eligible for depends on the following factors –

1. Applicant’s age
2. Nature of business
3. Source of revenue
4. CIBIL™ score
5. Financial history of the applicant
6. Business revenues
7. Total number of years in business
8. Repayment capacity and creditworthiness of the applicant
9. Profitability or stability of the business

Types of Business Loans and their Eligibility Criteria

There are different types of business loans offered by lenders. These loans can be used to cover business expansion costs, purchase of raw materials, establishment costs, infrastructure costs, etc. 

Following are the types of business loans and their eligibility criteria.

• Term Loan – Term loans offered by Flexiloans are flexi-term loans. These loans can be used to procure inventory or to expand the business’s digital presence. Term loans offer flexible repayment tenures, quick funding, and attractive interest rates based on your profile and eligibility.

• Line of Credit – A line of credit is specially designed to meet irregular funding requirements of a business. It is a credit facility based on the eligibility of the applicant which you can use when needed. The interest is charged only on the amount used. 

• Vendor Financing – This type of funding is usually provided to businesses or corporations. Here, the credit helps in funding the gap between when the applicant incurs expenses and when they receive payments. This solves the problem of liquidity while you are still waiting for payments to come to you. Based on the eligibility of the applicant, usually, 90% of the funding is provided to the applicant.

• Loan against POS – Flexi-merchant advance is a credit option that lets you take credit when your primary business is mostly operating offline. If you mostly take payments via credit cards/debit cards/card machines, etc. then this loan is for you.

How to Improve Flexiloans Business Loan Eligibility

1. Know the available options – It can be overwhelming to see the various business loans available in the market. It is advisable to familiarize yourself with all the available options and choose the one that best suits your profile, eligibility, and business needs. Knowing and applying for a loan that matches your eligibility is most likely to be approved.
2. Cash Flow – Lenders or financial institutions look at the available cash flow and not necessarily the revenue of the business. They would like to extend finance to profitable and cash-flow-positive businesses. Before approaching a lender for a loan, ensure that your cash flows are enough for the lender to approve the loan.
3. Security – Most business loans require the creation of main security utilizing the credit provided by the lenders. So, for example, if the applicant has procured machinery with the business loan, that machinery becomes the main security. Or, if the lender has procured raw materials, then the raw materials become the main security. If the applicant is unable to repay the business loan, the lender will confiscate the main security and sell it to recover their losses.
4. Reputation – An applicant with a good reputation will be more likely to be eligible for a business loan. Keeping your past credit history clean by paying your dues on time is an excellent way to ensure you have a good financial reputation. Avoid defaulting on loans/EMIs/credit card bills as they can immensely impact your reputation.

Calculation of Business Loan Eligibility

Lenders have the discretion to decide the eligibility of an applicant for a business loan. Their risk appetite decides if they approve or reject a loan application. 

Flexiloans business loans are offered to applicants who are –

1. Indian residents
2. Engaging in a partnership or proprietorship firm 
3. Self-employed
4. In a Public or private limited company

The eligibility calculation is dependent on a number of factors including the following –

1. 1. Age – The age of applicant should be between 21-60 years of age at the end of the loan tenure.

• Income – The most crucial element in deciding business loan eligibility is a consistent and regular flow of income. The yearly turnover should be more than Rs. 20 lakhs with a positive cash-positive forward picture. The most recent income tax returns should show a minimum taxable income of Rs. 2.5 lakhs a year.

• Business Stability – Being stable in the business for a long time is an indicator of the successful running of the business. Lenders prefer stable businesses with a steady flow of income. Lenders reserve the right to approve or reject an application. A start-up would probably be offered a business loan with higher interest rates.

• Outstanding debts – Applicants with existing debt will most likely be eligible but with a higher rate of interest. It is also possible that the applicant is capable of repaying the business loan along with the existing debt. In this case, lenders will be happy to approve a business loan at an attractive rate of interest.

• Creditworthiness – The CIBIL™ score is one of the most important factors considered by lenders while calculating the eligibility of an applicant for a business loan. A CIBIL™ score of 700+ is considered good for approval of a loan. It signifies great past financial behavior and hence will enhance the eligibility of the applicant for a business loan.

Conclusion

Flexiloans business loan eligibility depends on factors like age, years in business, creditworthiness, outstanding debts, etc. Flexiloans business loans are available for the purchase of new machinery, business expansion, increasing online presence, etc. There are different types of flexiloans business loans available that you can choose from. Flexiloans business loans are a great option to fund your business needs.