The Top 5 Benefits of Business Loans for MSME

Micro Small and Medium Enterprises (MSME) is one of the main growth drivers of India in recent times, with its contribution to GDP being almost as high as 8%.  The main reason for growth of the MSME sector are predominantly because of the availability of business loans for small businesses by NBFCs which do not need collaterals like the traditional sources of finance.

Traditional sources of finance, for example a business loan from a bank, was as unachievable to get as a star from the night sky! Not only was the process too long drawn and complex, but there were huge paperwork involved and most importantly people who needed the loan had to provide collaterals against the loan (which was very hard to do specially for the micro and small business people). But then came the era of the unsecured business loans by NBFCs and the rest is history!

So the small town vegetable vendor who wants to have a shop in the local market, the fashion designer who wants to open a store of his own, a factory owner who wants to purchase some additional machinery and the software developer who wants to start her own company, can all now do what they have always wanted – Convert their dream into reality! And for that, the only thing you need is, specially designed MSME Business Loans. So let’s look at the Top 5 Benefits of MSME loans over their traditional counterparts.

Minimal Paperwork: 

The first area where small businesses get stuck with the traditional finance sources is in the paperwork.  Too many documents are asked for and huge paperwork required to be done through a very complex and long drawn process. One of the most important benefits of an unsecured business loan from an NBFC is that it consists of minimal paperwork and documentation. For instance, at Tab Capital, once can get upto Rs. 1 crore business loan just by providing KYC details.

No need of collateral: 

Perhaps the most important benefit of MSME Business loans over traditional finance sources is that there is no collateral or security needed in order to get an unsecured loan. This results in a lot of convenience for the micro, small and medium players in starting or expanding their businesses. 

Higher Loan Eligibility:

For entrepreneurial startups and MSMEs, NBFC financial service providers offers higher loan eligibility so that their businesses can easily start.

Loan Disbursement in 2 Days:

Gone are the days of waiting months for loan sanctioning. One of the biggest benefits of a MSME loan is the fast disbursal. For example, in case of Tab Capital, unsecured business loan disbursal happens in just 2 days!

No prepayment Charges: 

Last but not the least, another benefit of an unsecured business loan is that usually there are no pre-payment charges levied in case of the full repayment of the loan.

To conclude it can be said that the above are the main reasons why unsecured MSME loans are preferred by, small and medium players where business finance is involved. Tab Capital is one of the most popular financial service providers who offer fast, easy and convenient business loans to small businesses.