SBI Business Loan

by Bizopedia · Published February 10, 2022 · Updated June 17, 2022

SBI business loan is a one stop solution for financing need for small business operation. SBI is the go to bank for every business due to its large network and trust worthiness that it has achieved over the period of years. in this article, we are going to look into various features and documentation required for a SBI business loan.

SBI Business Loan

Features of SBI Business loan

SBI business loan is offered as dropline overdraft facility.
Eligible customers include all business that are engaged in manufacturing, services or retail trade. Moreover, self employed individuals and professionals are also eligible to get this business loan.
Minimum loan amount that is offered in this loan is Rs 10 lakhs which can go up to Rs 25 lakhs
Current account with banking transactions for at least 12 months is mandatory condition to get SBI loan. Eligibility is calculated on average monthly bank balance with maximum limit of 10 times of last last 12 months average monthly bank balance.
10% margin is also maintained through stock and receivables statement
Pricing for SBI loan is linked to MCLR
SBI business loan also require a collateral of value that is at least 40% of loan amount financed
This loan can be offered for up to period of 60 months
Processing charges for this loan is Rs 7500 which would include charges related to documentation, inspection etc

Eligibility for SBI Business loan

Business vintage of at least 5 years in the same area and locality
Applicant should be either owner of the shop or have a valid tenant agreement for at least 3 years with owner of the shop
Current account vintage of at least 24 months with a regular bank.
Min Average Monthly balance of more than Rs 1 lac in last 12 months, with monthly threshold balance of Rs 10,00 Lakhs
SBi also has its own Go/No go criteria for disbursing business loans. If applicant is failing in any of the G/No go criteria then application would be rejected straight away

Assessment for Loan

Assessment for the loan would be need based
Financial statements are not necessary to avail this loan
The guarantee cover is available for five years and hence for advances granted under Mudra Scheme the maximum period is 60 months
Final loan eligibility is calculated on the basis of 10 times of average monthly bank balance that is maintained in the current account of the firm

SBI business loan is a very unique and popular product that is offered to every eligible business owner in the country. SBI loan interest rates are comparatively cheaper than those offered by other banks and NBFCs. If you are eligible for a loan from SBI then you should chose SBI business loan.

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