Eligibility criteria for taking a loan is simple. To ensure your repayment ability, few things are verified like minimum income, age and good credit score. It is also important to know that you should not have too many loans already. And if you do have, your strong ability to take additional debt will be checked.

Apart from the above, you are eligible for a Business Loan if you:

• Have business that shows a profit for the last three consecutive financial years
• Have business that shows an upward turnover trend
• Are able to show balance sheet that is audited by a registered Chartered Accountant.

Few documents are required to complete the application process. Below is the list of such documents which can slightly vary from case to case:

• Duly filled application form
• KYC documents of the company including PAN Card, Registration of Incorporation, Partnership deed, Memorandum & Articles of Association.
• KYC documents of the business owners
• Balance sheet and Profit & Loss accounts for the last two years
• Income Tax Returns for the last two years
• Company bank statements for the last six months
• GST returns for the last 6 months
• A report detailing how the Business Loan will be used.

There are certain important points that one should check before applying for a loan. These are:

• Processing fees
• Interest rate
• Any other charges
• Repayment procedure
• Pre-payments penalty, if any
• Foreclosure charges, if any

Please note that one should also check whether he/she meets the eligibility criteria or not.

Usually all lending institutions decide the amount of loan to be sanctioned based on various factors like

• Net in hand monthly income
• Generally, it is seen that EMI should not be exceeding 50-60% of your in hand income. It also includes any existing EMIs that you have. For example, Mr. Ajay’s net in hand income is Rs. 70,000, then he is eligible to get a loan where EMI does not exceed 35000. But if he is already paying 15000 as EMI on his existing loan, then he is eligible only for an additional EMI of 20,000.

The customer segments covered under Business Loans are listed below:

• Sole Proprietorship
• Partnership Firm
• Private Limited Companies
• Closely held Public Limited Companies
• Societies
• Trusts
• Hospitals, Nursing Homes, Diagnostic Centers, Pathological Labs.

No. Only home loan and education loan comes with a tax benefit. Personal loans, business loans and professional loans are not eligible for any tax benefit.