The rising costs of raw materials and expenses in the supply chain have made it challenging for Micro, Small and Medium Enterprises (MSMEs) to manage their working capital, machinery, and raw material costs. This has resulted in a need for more funds, hindering MSMEs growth, expansion, and diversification opportunities. However, India’s lending scenario has significantly changed over the past 5 years. The entry of private lenders and Non-Banking Financial Companies (NBFCs) have made lending more accessible and simplified the credit process. This has enabled MSME entrepreneurs to get access to formal credit, which was earlier a challenge due to the stringent lending policies of traditional banks.
In the last financial year (FY22), NBFC loans grew by more than 10%, almost double bank loans signalling the rapid demand for simplified access to credit. In addition, NBFCs and other financial institutions have digitised platforms that provide business loans. These platforms or online applications have certain eligibility criteria that determine the entrepreneurs’ and businesses’ credibility to confirm business loan eligibility in India before the loan gets sanctioned.
Kinara Capital is an RBI Registered Systemically Important NBFC firm that provides collateral-free business loans to small business entrepreneurs in the manufacturing, trading and services sector. Kinara is a fast-growing fintech company that uses a proprietary AI/ML credit risk assessment process that removes any biases while sanctioning a business loan. Customers can check their eligibility on the myKinara app and apply for a business loan with minimum documentation.
MSMEs can check Kinara Capital’s business loan eligibility in these 3 steps:
Customers can check their business loan eligibility in just 1-minute on the Kinara Capital website or the myKinara app, which is available on the Google Play store. The versatility of this process is that 7 language options are available for the customers to navigate their business loan eligibility in their preferred vernacular. In addition, one of the app’s significant advantages is that no documentation is required for eligibility checks, making the process hassle-free for customers.
The app’s streamlined approach to business loan eligibility checks ensures that customers can quickly and easily determine their loan eligibility and progress with their business goals.
A set of documents is required to check and verify some basic information about the applicant and the small business before any business loan is sanctioned. The document list is as below:
The whole process of document uploading is done in a highly secured online portal with no risk of data leaking.
Small business owners can receive loan approval and disbursement within 24-hours of submitting their documents once they are verified through digital channels. This streamlined process helps borrowers access the funds they need quickly and efficiently to support their business growth. In addition, this streamlined process eliminates the need for time-consuming manual verifications and accelerates the disbursement of funds to support the growth of small businesses.
When applying for a business loan, here are some points that are considered mandatory. These useful tips and facts can make the application process simpler for MSME business owners availing business loans:
To get a short-term loan, one should be an existing customer of Kinara Capital.
Kinara Capital is a leading last-mile lending firm in India, offering flexible financing solutions tailored to the needs of small business owners. They provide two main types of loans: working capital loans, for managing expenses, repairs, and business expansion, and asset purchase loans, for acquiring machinery and equipment to boost production. Working capital loans are available as short-term (6–12 months, INR 50,000–2 lakhs) or long-term options (12–60 months, up to INR 30 lakhs), allowing businesses to choose loans based on their financial needs.
Kinara Capital also supports women entrepreneurs through its HerVikas program, offering automated discounts on loans without additional paperwork. This initiative aims to make financing more accessible for women business owners, fostering their growth and promoting gender equality in the Indian economy.
As we have covered the types of business loans and the criteria for checking eligibility, it’s time to delve into some useful tips that MSMEs can follow to improve their chances of securing an MSME loan.
To improve your chances of getting an MSME loan, follow these strategies-
The digitisation efforts to smoothen the lending process in India will enable MSMEs easily access credit ease and help them grow and expand their businesses. MSMEs are the backbone of the Indian economy and providing them access to formal credit will help boost growth in the country.
Understanding the eligibility criteria for business loans is essential for entrepreneurs and businesses seeking financing options. Proper preparation in meeting these requirements, such as maintaining a good credit score, keeping accurate financial records, and presenting a well-defined business plan, can significantly increase the chance of securing a business loan. In addition, the recent digitisation of the lending process in India has made access to credit more convenient and efficient for MSMEs. The adoption of digital technologies by lenders has made it easier for businesses to apply for business loans online, track the progress of their loan applications, and receive funding quickly.
Kinara Capital has been a reliable partner for MSME entrepreneurs, providing unsecured business loans to help them achieve their goals. With a quick and digital-first 3-step eligibility process, MSMEs in India can easily apply for a business loan from Kinara Capital. The process is streamlined and straightforward, starting with downloading the myKinara app and checking the loan eligibility in just-1 minute. With Kinara Capital, MSMEs can access the financing they need to grow and expand their businesses without the hassle of complicated loan applications or collateral requirements.
MSMEs in the manufacturing sector must be registered for more than one year. Businesses in the trading and services sector can apply for a Business Loan only if the firm is registered for 2+ years.
Kinara Capital provides collateral-free business loans. This means that MSMEs will not have to submit any property documents while applying for a loan from Kinara.
The machine is hypothecated for issuing an Asset Purchase Loan from Kinara Capital. As long as MSMEs meet the EMI obligations, machine hypothecation will not occur. Machine purchase invoices and relevant documents will be required in exchange for the Asset Purchase Loan.
The tenure of MSME business loans from Kinara Capital varies by lender and can range from 12 to 60 months.
The maximum loan amount that an MSME can apply for from Kinara Capital is INR 2 crore.
No, you need not visit any branches. For support, you can contact us, and our field officer will visit you at your place of business to provide information and help you with the loan application process.
Business loans are typically repaid in Equated Monthly Instalment (EMI). Every month, the borrower repays a portion of their principal loan amount and interest rate charges to the lender in the form of an EMI. Typically, the EMI payment date is the same every month to make it easier.
By ensuring you have the requisite cash flow to make your EMIs, MSMEs can avoid missing a payment. This approach enables you to build your credit score and increase your future opportunities to avail credit access.
