Get the Tata Capital App to apply for Loans & manage your account. Download Now

Blogs SUPPORT
Loans For You
Loans for Business
Investment
Insurance
Apply

Quick Links for loans

Quick Links for Insurance

Investment

Offers Quick Pay
Back

Equipment Finance

Avail Digital Equipment Loans
up to Rs. 1 Crore

  • Attractive ROIs
  • Customizable Loan tenure
Know More
Back

Equipment Leasing

Avail Leasing solutions
for all asset classes

  • Up to 100% financing
  • No additional collateral required
Know More
Back

New Commercial Vehicle Financing

  • First time user
  • Retail and strategic Clients
Know More
Back

Used Commercial Vehicle finance

  • Repurchase
  • Refinance
  • Top up
  • Balance Transfer
Know More
Menu  
 
Apply Now

Tata Capital > Blog > Business Loans Processing Vs Personal Loan Processing

Loan for Business

Business Loans Processing Vs Personal Loan Processing

Business Loans Processing Vs Personal Loan Processing

When it comes to financial help; getting business or personal funding is a smart way to secure quick funds. While this depends on the purpose you need it for; both are useful in catering to your personal and business needs.

However, they’re vastly different when it comes to loan processing. If you’re unclear about it, here’s how the personal and business loans processing differs:

Usage of Funds

You can use personal finance for a wide array of requirements, including home renovation, higher education, wedding, travel, and more. In contrast, business finance is designed to cover business expenses such as machinery purchases, employee training, infrastructure expansion, etc.

Documentations

One of the biggest differences between business and personal loan processingis the required paperwork. Here is a list of documents required for business loan and personal finance:

Business FinancingPersonal Financing
KYC paperwork – PAN card, Aadhaar card, etc.KYC paperwork – PAN card, Aadhaar card
Business proofEmployee’s ID card
Passport-size photographsEmployee’s salary slips
Financial account statementsFinancial account statements
Latest ITR filings, profit and loss statements (last 2 years), income statements (last 2 years)Income proof
Audited financials from the past 3 years 
Other associated paperwork – an article of association/memorandum of association, sole proprietor declaration, etc. 
Income proof 

Additional Read: Top Things to Consider in Order to get Your Business Loan Approved In 1 Go

Eligibility Factors

The personal and business loan eligibility criteria for getting your loan offer approved is different for both options.

Eligibility for personal lending usually depends on a fixed monthly income, nature of employment, age, CIBIL score, professional experience, etc. Only by meeting these requirements, your loan processing will initiate.

However, for a business loan, applying businesses should be profitable for at least three successive financial years. Besides, the company’s turnover must show an upward trend, and your balance sheet must be audited by a registered Chartered Accountant (CA).

Collateral Requirement

Since personal and business funds are unsecured, they generally don’t require collaterals. However, business financing from some lenders can require security deposits.  Tata Capital offers collateral-free business finance at easy eligibility.

The Approval Process

Here’s how the loan approval procedure differs between personal and business lending:

Personal FinancingBusiness Financing
For these, lenders usually look for a stable income and an adequate CIBIL score.   You must also express a viable debt-to-income ratio (the lower, the better) to assure them that you can afford the financing burden.   Various papers, like residential documents, employment certificate, salary slips, etc., are required as proof of employment, income, and identity.These require good credit scores for qualifying.   You must display sufficient annual revenue with at least a few years of being in business.   Numerous business documents, like legal structure, business licenses, cash flow, profitability, etc., are required for approval.

Additional Read: How to Submit Your Business Loan Documents like a Pro and Get Them Approved?

Whichever the Loan, Tata Capital Provides the Best!

Whether you need personal or business financing, we at Tata Capital offer the best-in-class features for both. From compelling business loan interest rates to quick processing to minimal paperwork, our offerings are diverse! Get in touch today to know more.

Apply Now

Give Your Business the Right Boost: Apply for a Business Loan Today

Apply now
Popular Searches
business idea udyogini scheme hsn code full form low investment business ideas top 10 most successful businesses to start transport business import export business in india mineral water plant cost collateral free loans
Disclaimer

Most Viewed Blogs

Trending Blogs

Calculator

Personal Loan EMI Calculator

Personal Loan EMI Calculator
Home Loan EMI Calculator

Home Loan EMI Calculator
Business Loan EMI Calculator

Business Loan EMI Calculator
Used Car Loan EMI Calculator

Used Car Loan EMI Calculator
Two Wheeler Loan EMI Calculator

Two Wheeler Loan EMI Calculator
Loan Against Securities Calculator

Loan Against Securities Calculator
Loan Against Property Calculator

Loan Against Property Calculator
More Tools
Our Subsidiaries
Our Other Websites

Useful Links and Resources

Most Important Terms & Conditions - Home Loans

Download in your preferred language

Download

Policies, Codes & Other Documents

Most Important Terms & Conditions - Home Loans

Download in your preferred language

Download

Tata Capital Solutions & Services

Uh oh, something went wrong

Please try again later.