|Bank/NBFC||Institution Type||Minimum Loan Amount||Maximum Loan Amount||Minimum Tenure||Maximum Tenure||Interest Rates||Fees & Charges|
|Axis Bank||Bank||₹50,000||₹50,00,000||1 Year||15 Years||Custom||Up to 2% + GST as applicable|
|Aditya Birla Finance Ltd.||NBFC||₹50,000||₹15,00,000||1 Year||3 Years||16.85% - 17.85%||Up to 2% + GST as applicable|
|Arohan Financial Services Ltd.||NBFC||₹5,00,000||₹75,00,000||9 Months||2 Years||20.70% - 26.99%||1% + GST as applicable|
|Bajaj Finserv||NBFC||₹1,00,000||₹30,00,000||1 Month||8 Years||18% - 40%||Up to 3% + GST as applicable|
|Capital First||NBFC||₹10,00,000||₹75,00,000||1 Year||5 Years||16.00% - 24.00%||Up to 2% + GST as applicable|
|Clix Capital Services Pvt. Ltd.||NBFC||₹10,00,000||₹50,00,000||1 Year||3 Years||12% - 15%||Up to 2% + GST as applicable|
|Deutsche Bank||Bank||₹ 10,00,000||₹50,00,000||2 Year||4 Years||24%||Up to 3% + GST as applicable|
|Edelweiss Financial Services Ltd.||NBFC||₹3,50,000||₹25,00,00,000||4 Years||10 Years||20.50%||2% - 3.5% + GST as applicable|
|Equitas Small Finance Bank||Bank||₹5,00,000||₹75,00,000||1 Year||5 Years||18%||2% + GST as applicable|
|Fortune Financial Services - Kapital Tech||NBFC||₹2,00,000||₹150,00,000||3 Months||2 Years||15% - 24%||1.5% - 2% + GST as applicable|
|Fullerton||NBFC||₹10,00,000||₹50,00,000||1 Year||4 Years||13% - 16%||Up to 6.5% + GST as applicable|
|HDB Financial Services Ltd.||Bank||₹ 1,00,000||₹30,00,000||1 Year||5 Years||12% - 36%||2% + GST as applicable|
|HDFC Bank||Bank||₹50,000||₹50,00,000||1 Year||4 Years||15.65% to 21.20%||Up to 2.50% + GST as applicable|
|ICICI Bank||Bank||₹1,00,000||₹10,00,00,000||1 Year||5 Years||12.9% - 16.65%||Up to 2% + GST as applicable|
|IDFC Bank||Bank||₹1,00,000||₹40,00,000||1 Year||5 Years||11.69% - 15%||1.5% + GST as applicable|
|India Infoline||NBFC||₹1,00,000||₹50,00,000||1 Year||5 Years||18% - 25%||Upto 3% + GST as applicable|
|IndusInd Bank||Bank||₹1,00,000||₹15,00,000||1 Year||5 Years||10.6% -18%||0.5% + GST as applicable|
|Kotak Mahindra Bank||Bank||₹3,00,000||₹2,00,00,000||1 Year||3 Years||16.00 % to 19.99%||Up to 3% + GST as applicable|
|Lendingkart Finance Ltd.||NBFC||₹50,000||₹100,00,000||1 Month||1 Year||18% - 27%*||2% + GST as applicable|
|Magma FinCorp Ltd.||NBFC||₹3,00,000||₹2,00,00,000||1 Year||4 Years||17% - 21%||2% + GST as applicable|
|Neo Growth||NBFC||₹2,00,000||₹75,00,000||6 Months||2 Years||12% - 36%||2% + GST as applicable|
|RBL Bank Ltd.||Bank||₹10,00,000||₹35,00,000||1 Year||3 Years||16.00% - 27.00%||2% + GST as applicable|
|Standard Chartered Bank||Bank||₹10,00,000||₹75,00,000||1 Year||5 Years||13.5% - 20%||Up to 2% + GST as applicable|
|Tribe Tech Private Limited||NBFC||₹1,00,000||₹20,00,000||1 Year||3 Years||12% - 36%||2% + GST as applicable|
|Yes Bank||Bank||₹20,00,000||₹400,00,000||1 Year||5 Years||13.25% - 19.99%||Up to 2.5% + GST as applicable|
|Nature of Charges||Details|
|Processing Fees||Up to 2% (plus applicable tax) of facility amount|
The interest rate for every loan is determined based on evaluation of business, loan amount, financials and tenure.</p
|Stamp Duty and other statutory charges||
As per applicable State law
The average usage of about <50% - 0.50% p.a. on the difference between the actual utilization and average quarterly utilization of 50%. Charges will be imposed on quarterly basis. Applicable mainly for OD/CC facility
Charged up to 4% of total limits set-up in system, in case facilities are taken over by different bank during the contract of loan. These charges are applicable only in case of Balance Transfer (BT)
It doesn’t matter how small or big the business, to carry out all functions funding is essential. Funding is not just required in the form of one time investment-capital but also as a working capital at regular intervals. Not everyone will have money at all times to pool into business as and when required. Also, some days there will a need for a lot of money, while others days, there is absolutely no need at all. All of us will be happy to take a business loan that has less interest rate. Here are some information about business loan and its interest.
Business loan interest rates are mainly of two types which are reducing or diminishing Rate of Interest and Flat Rate of Interest. These are explained in detail here:
a. Reducing or Diminishing Rate of Interest
Reducing or Diminishing balance rate means the interest rate which is calculated each month on the remaining loan amount. In this technique, the EMI comprises interest that is payable for outstanding amount of loan for each month along with the principal of repayment. After each EMI payments, outstanding amount of loan gets reduced. Thus, the rate of interest for the following month is the calculation of interest only on outstanding amount of loan. Formula for calculating this reducing-balance interest is Interest Payable per Payment = Interest Rate per Payment * Remaining Loan Amount.
For example, if a person has taken a loan for amount Rs 1, 00,000 with reducing rate of interest method of 10% p.a. for about tenure of 5 years, then the EMI amount would decrease with every month’s repayment. The first year the borrower will have to pay Rs 10,000 as interest; but in the second year it will reduce to Rs. 8,000 on the reduced principal amount of Rs. 80,000 and so on, until the final year, which is when the borrower will have to just pay Rs. 2,000 as interest. This is a total opposite of fixed interest payment method.
b. Flat Rate of Interest
Flat interest rate means the interest rate which is calculated on full loan amount during the course of its tenure without considering that monthly EMIs would gradually decrease the principal amount and thus the interest rate. Therefore, the Effective Interest-Rate is prominently higher than nominal Flat-Rate. The formula for calculating fixed rate of interest is Interest Payable per Payment = (Original Loan Amount * No. of Years * Interest Rate p.a.) / Number of Payments.
For example, if a borrowers has taken a loan for amount Rs 1, 00,000 with the option of flat rate of interest of about 10% p.a. for a tenure of 5 years, then he would have to pay Rs 20,000 which is the principal repayment for the amount of (1, 00,000 / 5) + Rs 10,000 -interest at 10% of this 1, 00,000is equal to a total of Rs 30,000 year after year or about Rs 2,500 each month. Over the tenure of the loan, the borrower will end up paying Rs. 1, 50,000 that is (2,500 * 12* 5).
In addition, all interest rates charged by banks/NBFC’s which Finance Buddha works with follow a written down value principle. For more details on the amortization schedule please click here.
The rate of interest in business loans broadly range between 15%-24% p.a. The final rate of interest is dependent on the profile of the borrower, credit score, financials, existing leverage, business stability, industry outlook and various other risk assessment parameters.
There are main factors that determine the business loan interest rate. However, the top 4 among the list are mentioned below:
Before making the final decision on your business loan provider, make sure the various factors are compared with other banks and NBFCs. The factors that should be considered are interest rate, processing fee and other charges, EMI, which type of interest rate method is used, what are eligibility criteria, is there a need for collateral or not. How reliable the bank is, what minimum requirement criteria are and so on.
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