Business Loan without ITR Documents 2024, Apply Online

Business loans are a saviour if you seek funds to expand or operate your business. These funds help to manage your inventory, equipment, and operating daily expenses. The business loan process needs documentation, including Income Tax returns of the last 2-3 years. It is important for a business loan as proof of income to ensure that the applicant can pay back to the lender in the given timeframe.

But what If you don't have ITR? Then how would you get the business loan? You can easily get a business loan without ITR but at a higher interest rate. This blog provides insight into getting a loan without ITR and income proof.

Importance of ITR for Availing a Business Loan

ITR is a vital document required for a business loan as it assures the lenders that the customer will pay the loan on time. Let's see the importance of ITR for a business loan.

The banks need documents like P & L statements, balance sheets and ITR for the last three years. The ITR will increase the chances of getting your loan.
As per the Government, you must file ITR in a specific time frame. Filing ITR signifies that you are a good citizen and shows the lender that you are financially responsible and will pay back the dues promptly.
ITR records specify your fixed deposits, interest income from savings, business income, interest paid due to loans, and secondary income. So, the lender gets information about financial and business conditions.
The lender evaluates your net income via ITR and decides the loan amount based on income.

But you must be reassured if you dont have ITR, as you can get a hassle-free and easy business loan without ITR.

How do you Avail Business Loan without ITR?

An income tax return is income proof. Financial institutions use it to analyse the loan amount and the guarantee to repay it. Also, it ensures that income is sufficient to avail of business loans at low-interest rates.

If you don't have ITR and are thinking about getting a business loan, don't worry! You can get a business loan without ITR. We are discussing ways to get it.

Advantage from Government schemes- There are several schemes if you are looking for a business loan without ITR. Also, the collateral is not required.
Pledge collateral- You can get a business loan against an asset as collateral. It improves the chances of the application process and loan approval.
Improve CIBIL score- The lender evaluates the CIBIL score if you don't have ITR. A score above 750 improves the chances of getting a loan.
Apply for co-applicant loans- Family members can become co-applicants with valid income proof.

You can get a loan without ITR if your business is new or if you are starting the business after a gap. The list of documents needs to be completed per the terms and conditions of the lender.

Who is Eligible for a Business Loan without ITR?

You can get an easy loan without documents if you fall in the below-mentioned category:

Company
Individuals
Partnership
LLP
NGO
Sole proprietorship
Trust
Cooperative societies

Eligibility Criteria for Business Loan without ITR

We are discussing the eligibility required for a business loan without ITR. These are discussed below:

Credit S** core**- The CIBIL score above 750 increases the chances of getting an instant business loan.
Age - The minimum age must be around 18, and the maximum age must be 65.
Annual T** urnover**- The annual turnover requirement varies from bank to bank. You must contact your bank for the same.
Co-applicant - It is optional and is needed as per the requirement.
Collateral - The new business loan without collateral is valid for a loan amount of up to Rs. 2 crores. The loan amount comprises bill discounting, equipment finance, and a letter of credit.

Certain financial institutions offer business loans without GST or ITR. You can apply for loans from MFIs and NBFCs if you are an individual. Although interest rates are quite high, you can use the business loan without ITR and income proof against property, bonds and FD.

Documents Needed for Business Loan without ITR

The documents required for a business loan are mentioned below:

Complete the loan application form with a passport-size photo
Address Proof and business existence
Identity Proof like a passport, driving license and Voter ID
Income proof of last 12 months
Residence Proof- Voter ID, driving license, electricity or water bill, passport, bank statement and rent agreement
PAN card of individual/partnership/company
Rent agreement and Shops and Establishment Certificate
Company incorporation document
Another document, as needed by the lender

If you are looking for a business loan without ITR, you can compare the loan schemes issued by the Indian Government. Also, the loan is provided without collateral, but you must visit the website to check for eligibility and schemes.

The financial institution provides business loans as per their terms and conditions. Therefore, you must compare and check the repayment duration, interest rate, loan amount and foreclosure charges before finalising a loan deal per your financial needs.

Importance of Credit Score for Business Loan without ITR

A credit score is important in getting a business loan without ITR at a low-interest rate. It signifies the repayment ability and creditworthiness of an individual. The CIBIL score between 750 and 900 is considered good by NBFCs, and private and public banks.

The credit score takes a few months to reflect changes. If you maintain it, there are higher chances of getting a business loan at low-interest rates. So, monitor your credit score and repay the loan amount or credit card payment on time.

Steps to Avail Business Loans without ITR

There are various steps involved in getting a loan without ITR. The steps are discussed below:

Compare the interest rates of various financial institutions and banks. Select the one that is according to your terms and conditions.
Check eligibility for getting the business loan. You can visit the website and nearest branch for enquiry.
Select repay time duration according to your financial requirements.
Check the documents required.
Now, fill out the application and submit the documents required.

Interest Rates and Repayment Options for Business Loans without ITR

There are various financial institutions and banks that offer business loans without ITR. We are discussing various such options:

| Bank/Financial Institution | Loan Amount | Interest Rate | Tenure | | -------------------------- | --------------------- | ------------------- | ------------ | | IDFC First Bank | INR 1 lakh to 9 lakh | 19 - 24 % per annum | 12-48 months | | HDFC Bank | INR 1 lakh to 20 lakh | 18-20% per annum | 12-36 months | | Tata Capital | INR 1 lakh to 20 lakh | 19-22 % per annum | 12-36 months | | Bajaj Finserv | INR 1 to 15 lakh | 19-25 % per annum | 12-48 months | | Lendingkart | 1 to 10 lakh | 1.5- 2 % per annum | 1-36 months |

Alternative Options for Business Loans

Consider other options instead of taking a new business loan without security. We are discussing alternative options for business loans.

A microloan is one of the best solutions for micro and small businesses. The loans are especially for low-capital businesses, and you can use them to pay salaries, open a new business, consolidate debt, and sustain cash flow.
Personal Loan- An unsecured loan can be taken for various purposes. The banks only approve business loans with little revenue or business experience.
Term Loan- The short-term loan that can be taken to fulfil your fund requirements. You must repay the amount through a regular transaction in the given timeframe.
Line of Credit- You can take funds on demand in a defined borrowing limit. The loan can be secured and unsecured, and one can take the loan after paying the amount.
Equipment Financing- You can look for two financing options leases and equipment loans. The equipment loan is for business people who can pay down to buy expensive machines.
Invoice Factoring- You can sell outstanding invoices and take a loan. The factoring companies buy invoices and lend credit equal to 90 percent of invoices.
Merchant Cash Advance- The loan secured by a future sale is a merchant cash advance. The lender offers the entire amount that has to be repaid after sales. Medical offices, retail outlets and restaurants are eligible to take the loan.
Invoice Financing- It is one new business loan without collateral. You can use invoices and take a loan. It is the best alternative for businesses that don't need quick cash.

Government Subsidy Loans for Businesses

Some of the business subsidiary loans are mentioned below:

Stand Up India- The Government started it for women entrepreneurs and people in SC/ST category. The loan amount is around ten lakhs to 1 crore. Apply for the loan if you deal in trading, manufacturing or agro-allied services.
Pradhan Mantri Mudra Yojana is a collateral-free loan for small and micro organisations comprising zero to prepayment charges in 1- 5 years. The maximum loan amount can be around ten lakhs.
SIDBI Make in India Loan for Enterprises- The loan can be applied to micro and small organisations to manage the debt-equity ratio.
Credit Guarantee Scheme- It offers loans of up to 200 lacks. Various banks offer this type of loan.

Banks Offering Business Loans without ITR

Various banks that offer business loans without ITR are:

HDFC Bank
Tata Capital
IDFC First Bank
Bajaj Finserv
Lendingkart

Conclusion

Many banks and financial institutions are providing business loans without ITR. The loan helps small and medium-sized entrepreneurs expand their businesses and manage the fund's requirements.

You can go through the entire article to gain complete knowledge about applying for a business loan without ITR, the types of the new business loan without security and the documents required.

FAQS on Business Loans without ITR

What is the minimum ITR required for a business loan?

The minimum annual income for the business loan must be around 1.5 lakhs rupees per annum. You must be at least 21 years and a maximum of 65 years of age.

What are the drawbacks of applying for a business loan without ITR?

Some disadvantages of the business loan without ITR are fewer business loans, delays in application processing, high-interest rates and short repayment duration.

Can I get business loans without ITR?

Yes, you can get a business loan without ITR. However, the loan's approval depends on the lender's terms and conditions.

What can help when filing for a business loan without ITR?

You can apply for a loan without ITR if you have a credit score above 750, take advantage of government schemes and apply for the loan with co-applicants.

What is the minimum and maximum age to avail of a business loan?

The minimum age to apply for a business loan is 21 years, and the maximum is 65 years. You can easily apply for a loan, as many financial institutions offer loans without ITR and income proof.