How to Obtain a Loan for Purchasing Used Machinery and Equipment?

Automation or the deployment of machinery is a vital stepping stone in escalating the annual turnover of a business. With the help of advanced machines and equipment; a company can increase its productivity and also mow down labour cost.

However, often start-ups and SMEs are faced with insufficient working capital and the lack of significant turnover. Under such situations, opting for second hand machinery can serve one’s purpose adeptly. In fact, to meet the fund requirements, a business owner can avail a equipment financing from any reliable financial institution.

Now, the question arises, “how beneficial will a machinery loan prove to be?” Well, have a look the following section.

Firstly, the features:

  1. A loan up to Rs.30 Lakh

Proficient lending institutions like Bajaj Finserv can offer up to Rs.30 Lakh of equipment financing. Due to availability of higher loan amount, it becomes easier for start-ups to integrate used machinery and that too within a budget.

This enables them to maintain their production volumes without depleting their working capital.

    2. Availability of pre-approved offers

With minimal documentation, pre-approved loan offers allow business owners to get hold of their loan amount at the earliest. This not only saves valuable time, but also aids a business owner to eradicate all persisting financial discrepancies.

    3. Flexible repayment tenor

A flexible repayment tenor from Non-Banking Financial Institutions allows borrowers to repay their outstanding amounts within convenient repayment periods and at attractive interest rates.

    4.Collateral free loans

Reliable NBFCs like Bajaj Finserv offer machinery finance without any collateral or a guarantor. It simply implies a business owner now doesn’t need to mortgage or hypothecate his asset in order to get the sanctioned amount.

Now, learn the benefits.

  • Simple and secure

With the features mentioned above, it is evident that applying for machinery loan is hassle-free. Moreover, with a higher loan amount and quick turnaround time, entrepreneurs can now meet their funding requirement to secure their businesses.

Additionally, borrowers may remain stress-free as machine loan is unsecured by nature.

  • Transparency with loan terms

All reputable NBFCs come up with transparent loan policies. They believe in providing complete sets of loan policies so that business owners can plan their finances in a better way. Moreover, these NBFCs also allow a business owner to log-in to their online portal and monitor their existing intricacies anytime and from anywhere.

  • Easy online account access

A business person can apply for a loan relaxing at his office via online portal.

Apart from that, one can get easy online access regarding loan information anytime and anywhere. This will help borrowers to keep track of their expenditure, interest etc. relating to their loans.

So, who all are eligible for this kind of equipment financing by NBFCs?

  • A business owner should range between 25-55 years in terms of age.
  • Minimum vintage for a business should be at least 3 years.
  • A business needs to have its prior year’s turnover audited by a CA.
  • Borrowers must have their Income Tax returns filed at least the past 1 year.

Lastly, here is a quick view of required minimal documentation during applying for machinery loan:

  1. Certificate of practice as a business proof.
  2. KYC documents.
  3. Bank account statement of a prior month.
  4. Proof of residence or business/ office.
  5. Machinery-related documents.

To have a smooth operation of your business, purchase of machinery and equipment is mandatory. In such scenario financial institutes help the company to reach its potential with the aid of machinery loan, funding the lease or purchase of equipment.

This ensures distinct benefits for the businessmen allowing them to flourish in an effective and better manner.

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Written by anujkrpandey

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