The government as well as various commercial banks have taken initiatives to encourage and support start-ups in India. For this reason, availing a business loan for your start-up business has become easier than the funds are also available for home businesses. The start up business loan has its own benefits, which include,
- Hassle free approval.
- Low rates of interest.
- Flexibility in loan amount.
- Favourable repayment terms.
- Easy monthly payment options.
- Quick, 1- minute application process.
Let us checkout how to use a business loan for a home based startup business.
Advertisement and marketing of products is the primary challenge for home based startups. On the other hand, it is very important to build a brand image to acquire customers. Use the business loan to make the presence visible in the market; online and offline marketing are a couple of ways in which products can be promoted using a business loan.
Also Read: The Reality of Being Self-Employed
Purchase inventory and equipment
Creating inventory is an important part of business expansion. Buying manufacturing equipment, registers, machinery, getting space to store goods and electronic gadgets will help the business compete with bigger brands.
Get working capital
In order to get a company off the ground lot of working capital is needed. This requires money to incur day to day expenses like salaries, electricity and utility bills. If you are short of funds, a start up business loan can help fix the problem.
Use the funds to get more helping hands who are experts in different fields. This will also give you more time to generate better business ideas and strategies.
Purchase real estate
In case you want to get an office and grow the startup business, a loan is important. The funds will help you buy an office space.
Also Read: How to start business
Adopt advanced technology
Cloud computing, share point and shared drive installations can cost a decent amount. Use business loans to fund these advanced technology implementations; these are important for home-based businesses to be in regular contact with its employees and customers.
Getting a business loan for startup business might be a bit tricky as the company does not have its own space. Few suggestions to get this kind of business loan easily are
- Opting for online lenders instead of bank loans; banks are stricter in regards to home-based business loans.
- Demonstrate that the company is trustworthy borrower by providing enough material proof of profits.
Eligibility for getting loans for home-based businesses is,
- Driving license
- PAN/ Aadhar card
- 21-65 years of age
- Last 6 months bank statement
- Certificate originals Memorandum and Articles of Association
So, knowing the loan purpose, right financing, getting the right lender etc. are some of the factors which must be decided before opting for a start up business loan.