Being your own boss can be a struggle, but there is great satisfaction in seeing your own business grow from an idea on paper to profitability. Abhishek Joshi, a chemical engineer, had a similar dream of successfully running his own cleantech company.
His new venture required an investment of Rs. 20 lakh. To fund his venture, he started researching about various loans available in the market. He came across an exclusive loan designed for professionals known as Loan for Engineers by Bajaj Finserv. With multiple benefits along with quick approvals and attractive interest rates, he decided to apply for the engineer loan immediately.
What are Engineer Loans?
Engineer loans are one of the many types of professional loans available today. It is a specialised loan scheme available for professionals with an engineering background. It provides finance to set up, expand and run your business.
Benefits of Engineer Loans
Flexible line of credit
The main plus point is that it is a credit facility with flexibility. You get a credit line for a fixed tenor. But, you pay the interest only for the amount actually borrowed, not for the amount approved. In addition, you can pay the EMIs only for the interest component. This reduces the EMI amount substantially and the principal amount can be repaid at the end of the year.
Example: Abhishek had applied for a loan of Rs. 15 lakh but he borrowed only Rs. 8 lakhs. Instead of the approved amount, he paid interest only on the borrowed funds. By doing this he saved significant amount on interest. And at the end of the tenor, he made enough business to repay the principal.
A hassle free loan
Availing a loan becomes stressful when you have to provide a collateral or guarantor. It ensures that you make timely payment. If you fail to repay, then the lender can use the collateral to recover the cost. But, what if you are a start-up or do not have any asset to use as collateral? Engineer loans make it possible. You can get funds only on the basis of your credit history and the relationship with the lender.
If your credit rating is good and you have been a loyal customer to the lender, then the entire process of getting the loan becomes easy and quicker.
Substantial loan amount
With an engineer loan, you can buy the latest machinery or raw materials and avoid delaying the expansion plans. You can avail a loan of up to Rs.15 lakh for your business. You don’t have to take loans from multiple lenders and add your worries.
Attractive interest rates
The interest you pay on a loan is the cost of borrowing the funds from the lender. Thus, the interest portion decides how much you will have to pay from your earnings. Taking a loan with a higher interest rate is sure to burn a hole in your pocket. This can largely affect the profitability of your business unit.
Engineer loans offer lower interest rates to the customers. The lower the rate of interest, cheaper is the loan cost and your expenses reduce. This will help you have more funds to take care of your daily operations.
Pre-approved loans for existing customers
Existing customers can get engineer loans faster. Your past relationship and loyalty with the lender helps to avail a pre-approved engineer loan. With this benefit, your loan may be disbursed within 72 hours. So, if you have to make an urgent payment to your supplier, pre-approved loans are can be helpful. Even when the raw material is damaged in a mishap, with pre-approved loans, you can source a new batch soon to meet the delivery deadline.
Minimal documentation
You do not have to submit a huge set of supporting documents to avail a loan. Documentation becomes difficult for new businesses as they do not have past financial records. But with an engineer loan, you can get funds for machinery and equipment by submitting few basic documents. Documents include proof of identity, address and income, and educational certificates.
Every professional needs to be well-financed with enough working capital to keep the business running. Make use of this special loan to kick-start your entrepreneurial journey.