Knowing the Business Loan Balance Transfer in Detail

Business Loans has the capacity to meet the demands of employees, clients and on the same hand, it can maintain the cash flow for your business. Business loans are helpful to scale up your business as it provides you an abundance of funds to expand and grow your business.

Business loans are in high demand these days and are widely available by a number of banks. So it may happen that you choose a lender which seems best for you at that particular time, but later you realize that there are banks offering the same loan at a lower interest rate as compared to the one which you opted. Or you may get to know that another lender is offering the same loan at the same interest rate but there is some add on benefits such as high tenure, no pre-closure charge, etc. In a situation like this, what will you do? Would you like to continue your loan with the same lender? A thought will definitely come in your mind- I did a mistake, I should have opted that lender so that I could have saved some money.

Well, if you are in such a situation, Balance Transfer is the only solution for you.

Balance transfer of Business Loan reduces the interest rates of your business loan and hence enables you to save money on the interest you have to pay.

Balance transfer of Business Loan is the transfer of your entire unpaid principal business loan amount to another bank which is offering the same loan at a lower rate of interest. The bank to which you are shifting your outstanding loan treats your loan as a completely new loan and provides you with all the benefits as they do to a new loan.

The existing bank whom you are having your loan gets the unpaid amount and you have to now pay your EMIs to the new bank who offered you the loan at a lower interest rate.  

There are many Banks and NBFCs offering the facility for Business Loan Balance transfer, let’s discuss the top three of them in detail.

ICICI Bank Business Loans

ICICI Bank offers business loans to the entrepreneurs and businessmen which can help them to take their business to new heights. The loan is available at affordable pricing. The most important facility which ICICI banks offer is the availability of the balance transfer facility.

The bank provides a fund which can be used as working capital for your business and even for the threading services. The bank understands the business requirements and hence provide funds for all your business requirements.

Who can avail ICICI Bank Business Loan? (Eligibility)

  • One should be an owner of a business and should have an already existing business loan with another lender.
  • Entrepreneurs in the field of manufacturing, trading, and service providing are eligible to apply for this loan.
  • Sole Proprietorship Firms, Partnership Firms, Private and Public Limited Companies are also eligible to avail this loan.

Documents Required for ICICI Business Loan Balance Transfer

  1. Completely filled business loan application Form
  2. No objection certificate from your previous lender
  3. KYC Documents – Aadhar card / PAN Card / Driving License / Voter ID card of
  4. Partnership deed / Certificate of Incorporation / Certificate of Establishment
  5. Copy of PAN Card of Entity, Proprietors / Partners / Directors, Security providers, and guarantors
  6. Address Proof: Aadhar Card / Ration Card / Utility bills such as water bill / telephone bills of Entity etc. of Proprietors / Partners / Directors, Security providers, and guarantors.
  7. Financial proof: Last 3 years Audited / Provisional Financials such as  Balance Sheet / Profit and Loss statements, Tax audit reports and VAT returns are also required to submit.
  8. Turnover on the letterhead of the entity
  9. Last one-year Income Tax returns of the applicant.

Details of ICICI Business Loan

Lowest EMI per lakh: ₹3,540

Processing charges: Starting from 0.99% and can go Up to 2%

Tenure Period:  From 12 months to 36 months

Loan Amount: Minimum of ₹1 Lakh to a maximum of ₹40 Lakh

Part Prepayment: Not allowed

Early Foreclosure: Allowed but only after 6 EMI’s

Foreclosure charges: 5%

Balance Transfer: Allowed

Standard Chartered Bank Business Loan

Standard Chartered Bank offers collateral-free business loans to the customers to widen your business spread. Standard Chartered bank provides easy access to the funds for all your business requirements, from working capital to the extension of your business everything is possible, which you want to do for your business. The bank provides a high loan amount with the best of the offers along with flexible which makes it more convenient for the people.

Details of Standard Chartered Business Loan

Age – Minimum age of 23 years

          Maximum age of 58 years

Minimum Income Required: ₹ 50,000 per month

Maximum Loan Amount: 15x of monthly income

Maximum Loan Amount: ₹30 Lakh

Minimum Work Experience Needed: 36 months

Maximum Loan Tenure: 60 months

Balance Transfer: Available

Documents Required

  1. Bank statements for the last 6 months.
  2. VAT/GST statements of the business for the last 1 year.
  3. Profit & Loss (P&L) statement of the last 2 years, balance sheet and income tax returns of the last 2 years
  4. Documents related to the establishment of the entity, identity and address proof documents of the owner / businessman involved.
  5. No objection certificate from the previous lender.

Who can Avail Standard Chartered Business loan Balance Transfer (Eligibility)

  • One should be an owner of a business and should have an already existing business loan with another lender.
  • Age: The minimum of the applicant to avail this loan is 23 and the maximum is 58 years.
  • Your net monthly income should be ₹50,000 in order to avail this loan.
  • Adding a co-applicant to your business loan application can increase your eligibility to avail the loan.

IndusInd Bank Business Loan

IndusInd bank provides funds to your business for funding the inventory & managing the capital flow of the business.

The interest rate charged is affordable which comes along with flexible tenure. The balance transfer facility provided by the bank makes it a better option as many people want to shift their existing business loan to another bank to avail lower interest rate.

Moreover, IndusInd Business loan does not require any collateral and promises fast processing of your business loan application.

IndusInd Bank Business Loan Details

Interest Rate: Starting @ 11. 90%

Processing Charge: Up to 2.50% of the loan amount

Loan Tenure: Starting from 12 months and can go up to 60 months

EMI per lakh: ₹ 2,327

Loan Amount: Minimum ₹50,000

                          Maximum ₹15 Lakh

Balance Transfer: Allowed

Top up loans: Available

Prepayment: allowed but only after 6 months

Prepayment charges: 4%

Who can Avail an IndusInd Bank Business Loan Balance Transfer (Eligibility Criteria)

One should be an owner of a business and should have an already existing business loan with another lender.

  • Age – 20 years- 60 years
  • Income Required – Minimum of ₹25,000
  • Work Experience – a minimum of 2 years
  • Current work experience – a minimum of 1 year

Documents Required

  1. Proof of Identity: Passport / Driving License / Voters ID / PAN Card
  2. No objection certificate from your previous lender
  3. Proof of Residence: Rental Agreement / Ration Card / Utility Bill (such as water bill / Electricity bill etc) / Trade License / Establishment / Sales tax certificate/ Valid Passport – provided the passport address is present address mentioned in the application form.
  4. Proof of Income: Bank Statements for the latest 6 months / Latest 2 years ITR / P&L statement.
  5. Business Continuity Proof: Trade license, Establishment, Sales Tax documents
  6. Additional Documents: Sole Proprietorship Declaration, Certified copy of Partnership Deed and Certified copy of MOA

Bottom Line

A balance transfer is very effective as it reduces the payable interest rate and hence EMI for your business loan. The interest rate of business loan is already higher so even if you are able to save a bit on the interest that can save a lot in bulk over the complete tenure. So, before you opt for a business loan do check for the balance transfer option.