A secured loan is a type of loan in which a borrower pledges an asset such a car, property, equity, etc. against that loan. The loan amount made available to the borrower is usually based on the value of the collateral. If in case the borrower defaults the loan, the lender can liquidate the asset and recover the loan amount, making these loans risk-free for the lender. As a result, these loans are easier to obtain and charge a lower interest rate than an unsecured loan.

Features of Secured Loan

The features and benefits of Secured loans are

  • Loans are given against the title of ownership of assets, which will be used as collateral (like homes, vehicles, assets, property).
  • Lower interest rates as compared to unsecured loans, because the bank has a higher level of confidence in your ability to repay.
  • Loan approval is faster.
  • These loans are available to non-salaried individuals.
  • Banks and lenders can repossess assets for which loans were taken.

Bill Discounting Loan

They are short term business loans using unpaid bills as security

Cash Credit Loan

Cash credit is a short-term Business loan extended to a company

Machinery Loan

This loan allows to the business to increase its overall productivity

Working Capital Loan

These loans are not used to buy long-term assets or investments

Export Credit Loan

Credit Guarantee Funds Trust for Micro and Small Enterprises

Bank Guarantee Loan

Credit Guarantee Funds Trust for Micro and Small Enterprises

Loan Against Property

This loan is usually taken for expanding business, acquiring assets

Project Loan

Credit Guarantee Funds Trust for Micro and Small Enterprises

Eligibility Criteria for Secured Business Loan

The eligibility criteria for Secured loans are listed below:

  • Minimum age criteria to apply is 21 years, whereas maximum can exceed up to 65 years at time of loan maturity, in some case the age can exceed up to 70 years
  • Applicant or business should have good credit score and repayment and financial history
  • Appropriate cash flow and security to be shown before availing secured business loan
  • Business existence of at least 2 years
  • Running business in profit for past 2 years
  • Owning at least one out of these properties that include factory, shop or residence

How To Apply For An Secured Business Loan?

At SME Paisa, you can apply for Secured Business loans online or offline. Walk into our nearest branch office for a free consultation and guidance regarding an ideal funding option suiting your needs. Or, you may choose to apply online and get an instant approval for funds. Remember to keep a soft-copy of documents required for Business loan ready for upload in case of an online application

Document Required for Secured Business Loan

The list of documents required for a Secured Business loan application includes:

  • Passport sized photographs
  • PAN Card – For individual, company and firm
  • Identity Proof: Passport, Voter’s ID, PAN card, Driving License
  • Address Proof: Aadhar Card, Passport, Driving license, Utility Bills (Telephone, electricity bills)
  • Business Address Proof: Copy of property documents
  • Income Proof: Bank statement of last 6 months, Last 2 years’ ITR, Balance sheet, P&L statement for last 2 years (audited by CA)
  • Income tax returns
  • Processing fee cheque

Frequently Asked Question

Your loan can serve a variety of needs, everything from home renovation to debt consolidation and more.

If all your documents are in order the loan should be credited to your account in 24 hours.

Yes, but it comes with a marginal charge. You can read about it

As long as you fulfil the unsecured Business loan eligibility criteria, you can easily avail one. You can apply for unsecured Business loans online within seconds and fill in the required details on the application form. You will also need to upload the required documents, and click on “Submit”. Our online loan application process provides you with an instant decision. Post loan approval, a customer representative will contact you to discuss your requirements and guide you further
Alternately, you can Contact Us and speak to a customer service representative. You may even visit your nearest branch to proceed with the loan application process.

It is completely safe to obtain collateral-free loans by SME Paisa. Our transparent pricing and procedures make the borrower aware of what to expect from unsecured loans and products.