Working Capital in Needs A Working capital loan is generally taken to boost the working capital available to a business. This loan is taken to finance a company’s everyday operations. Working capital in needs covers a company's short-term operational needs such as raw material procurement, wages, freight, and other required inputs to come to the finished product.
Working capital Pune can also be used for specific growth projects, investments in a new market, and so on. A working capital loan is taken to free up cash for growing the business at a faster rate. The prerequisites for a Working Capital Loan for business may differ from one financial institution to another. Here are some prerequisites for a Working Capital Loan: ● ● ● ●
The company must meet the minimum operation period required by the institution (That may be a minimum around 6 months). The company should need to meet the minimum turnover amount required by the bank or institution. The business must not be categorized under the blacklisted/excluded list of SBA finance. You may have to meet the physical location requirements of the institution too. Your company must not be an NGO, trust, or a charitable organization.
There are various types of working capital loans available in the market today. Here are some of the important types: ● Short-term loans Short-term loans can be taken for Working Capital Finance. These loans come with a fixed payment period and rate of interest. Short term loans are usually secured but it may change depending on the credibility of your credit history and relation with the lender.
● Overdraft Facility Overdraft facility is given by financial institutions wherein they approve a certain amount for the borrower’s use. The borrower must not exceed the limit of the cash approved by the lender. The borrower is only charged interest on the amount withdrawn and not the approved amount. ● Bill Discounting Bill Discounting is a facility through which a trader gets payment from a financial institution be it banks or NBFCs before receiving it from the buyer. The buyer then pays the financial institution according to the due date mentioned on the invoice. This facility is very useful for businesses and traders.
● Cash Credit Cash Credit is a short-term source of financing for a business. It enables a company to withdraw money from a bank account without keeping a credit balance. The credit is limited to only borrowing up to the borrowing limit. Lease Rental Discounting is also another facility which is very useful for funding businesses.
With the various procedures and documentation required, the procedure of getting a Working Capital Loan can be exhausting. But no worries! Terkar Capital, one of the leading financial advisory firms in Pune, can help you. The executives at Terkar Capital make sure that the process of the Working capital Pune is effortless and you get your funding as soon as possible. Terkar Capital offers financial support and expert guidance for the right selection of the working capital products, a quick turnaround time, and provides the best ROI for you. If you are looking for financial advice, contact Terkar Capital now!