HOW ONLINE LENDING IS CHANGING THE BANKING LANDSCAPE AND HELPING SMALL BUSINESSES CUT TO THE CHASE

Ready access to sufficient working capital loan would be nothing less than a stroke of luck for most of the entrepreneurs, helping them hit the next level of growth. Nonetheless, no wise businessperson can even imagine getting a credit to finance their firm without asking in the same breath— but from where I can get it, and how much will it cost?  

Keeping a steady influx of cash is a delicate act which is crucial to a small business sustainability. Blame it on late payments, off-season slump, or a pressure to fulfil a big urgent order; most owners struggle to keep it together and often end up suffering cash crunch. 

Though it might look simple to apply for SME loan in India, and get out of the red zone, however, there is another side to this story— Apparently, the banks can take forever to grant you the credit, bringing growth plans to screeching halt. Fret not though! There is a way out— you can take help from the online lending portals offering immediate funds and turn the tide in your favour. No wonder, many small and medium-sized enterprises are leaning towards them to realize their business potential. 

This extensive guide will lead you through the affordable loan options, how to attain them, and why they hold a bright future, particularly for the small business loan requirements.

Seamless application process: Indian Online lending portals have made the process of attaining Personal Loan for Business simpler and user-friendly. Till recently, businesses in desperate need of financial assistance often turned to the banks or credit providers. They had to wait endlessly and rely on their market reputation and strong recommendations to get through the first phase. It was soon followed by a pile of paperwork and other formalities, and yet there was never a guarantee of making it through. A few lucky ones did pass; while a whole bunch of the applications ended up in the rejection box due to discrepancies in the credit history. 

The online lending is indeed a pleasant respite from the lengthy business loan application process. Here’s how it works.

  1. Start by accessing the website or download the app on an online lender
  2. Fill in your mobile number
  3. You’ll receive an OTP for verification
  4. Select the corporate loan option
  5. Fill in the required credit amount.
  6. Submit details such as PAN Card, GST, Voter Id etc.
  7. Upload relevant documents

By merely following the above seven-step process, you are done with the application part. 

Unbelievably quick approvals: If creating a credit-seeking application for your business was any fast, the approvals are even quicker. Here are a few steps that follow soon after your application submission.

  1. All submitted documents are reviewed and verified by the financial experts
  2. Receive permission
  3. Submit the bank account details
  4. And lastly, the requested amount is credited directly to your bank account.

The whole process won’t take more than just a few hours’ time. The combination of technology and humans make online loan platforms work real fast. The software matches the documents with the set requirements, which are not too extensive— it hardly takes a few minutes to wrap it up. Online review for credit history also finishes in a matter of few moments; courtesy, the availability of all the required details on CIBIL. Finally, professionals recheck the application for the one last time before approving the fastest business loan. 

Even if somehow you fail to crack it, they’ll inform you without any delay. Meanwhile, you may keep trying your luck at other online lending portals. This way, you don’t waste time waiting for days just to hear back that your loan sanctioning request got disapproved.

Online loans are flexible as per the requirement:  Business requirements shift rapidly, which could drastically alter their financial needs. Banks typically require tons of paperwork and hordes of manual procedures. It means you might have to go through a whole process for a slight change in financing— from application submission to requesting the acceptance (which is not sure either), you could be redoing it all.

On the contrary, online lending platforms are backed by technology. It makes the communication part easier and changes faster to implement. For instance, if you want to revise the credit amount, you’ll simply submit the Digital Business Loan revision request on the online lending portal. It would straightaway travel to the inbox of the concerned person. He/she will review your change request and will take immediate action. In short, no visits, no excessive paperwork, and no wastage of time— all this and more at a mere click of a mouse. It is as flexible as it can get!

Forging lasting bonds with the online financers: The most identifiable thing about online lenders is that the companies can establish long-term relationships with them and have easy access to funds whenever required. You get to connect with your creditors, even if you are applying for a seemingly small amount. Also, if your payments are regular and are made on a timely basis, the portal opens up access to the higher business loan amount than the previous one. The lending-borrowing cycle continues, and the value of the unsecured business loan keeps rising, given your payments are regular. 

There are quite a few online lending platforms in India, but they are in a growing phase and also trying to beat the direct competition from the banks and other financial institutions. For loan requirements, 40 per cent of MSMEs have already switched to these credit lending platforms. Whether or not to rely on software to collect borrowers ‘ credit history is still a big challenge for the Indian economy though.

With advances in technology, gaps are closing fast. As we keep moving nearer to collecting the factual data digitally, the dependency on banks and other financial institutes would go down automatically, driving more and more businesses toward the online lenders for unsecured business loan. 

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