The new reforms passed by the Government has given a tremendous boost to the rural connectivity program. Under this plan, around 100 kilometers of rural roads will be constructed daily. Several car manufacturing companies are working overtime to develop low-cost vehicles to enable people in villages to own a four-wheeler.
Historically, people living in rural areas of the country were unable to afford a car due to high costs, bad road conditions, and unavailability of loans. All these problems have been overcoming with many lenders offering affordable and quick automobile loans.
Getting a car loan is now easy. Many lenders offer loans for new as well as used cars. The entire process is simple with minimum documents requirement. Borrowers are also assured of not facing any difficulties with flexible repayment options. Moreover, the loan amount may be repaid in Equated Monthly Installments (EMIs). The entire procedure from loan application to approval is completed within a few days.
Here are five tips to help you negotiate on the loan.
One of the best methods to reduce the car loan EMI is to negotiate its price. Most car dealers make big profit margins when they sell a vehicle. It is, therefore, recommended that buyers check with several dealers to bring down the cost of the car as much as possible. Often, dealers provide discounts and special offers especially during the festive season and buying a car during this period may help lower the cost.
These days, several banks and non-banking financial companies (NBFCs) offer automobile loans. As a result, borrowers are able to enjoy lower car loan interest rates. Most buyers rely on the dealers to arrange for the loan. However, the interest rates may be higher from these lenders because they often pay a commission to the dealers. Checking with other lenders is recommended to ensure borrowers receive the lowest interest rate.
Car finance is available for as long as five years. Most buyers often choose longer loan tenure to reduce their EMI. However, individuals overlook the fact that when they opt for a longer duration, they pay more interest. It is therefore recommended that borrowers choose a shorter tenure if they are able to afford a higher EMI. A shorter duration will help borrowers save a significant amount on their loan repayments.
Most people do not read the loan agreement before signing. However, it is important to read and understand all the terms and conditions prior to making the decision. Clearly understanding various features like interest rates and prepayment penalties is crucial. Seeking clarifications from the lenders before signing the agreement reduces the possibility of any difficulties in the future.
Buying a car is a huge financial decision. Based on your income, you may avail of up to 100% of the ex-showroom price of the vehicle. An affordable automobile loan now makes it possible for you to drive away your dream car.
As the name suggests, a used or pre-owned car loan is a facility offered to people who are looking to buy a used or pre-owned car.
Such cars generally come with lower registration fees and insurance charges, a slow rate of depreciation, and a lower loan amount to be borrowed. All in all, they offer good value for money.
But, not all the terms and conditions that come attached to these loans are well-documented or understood. Let’s take a look at some of the more common questions customers generally have about these type of loans:
You can easily apply for such a loan on our website or by visiting the closest branch. You will need to provide your details and the required documentation before your loan is approved.
Depending on the type of car, its condition and age, and your own loan repayment capability, the amount that the financial institution is willing to offer will vary. In most cases, you can get up to 90% of the total value of the pre-owned car. In certain special cases, finance for the entire cost is also approved.
Irrespective of whether you’re a salaried individual or a self-employed person, you can apply for a previously owned car loan. However, your age, salary and financial standing will be taken into consideration. You are most likely to get a loan approval if:
Note: In most of the above cases, you can also avail a loan for small business.
The tenure of the loan depends on the age and condition of the car. Typically, it ranges from a minimum of 1 year to a maximum of 5 years.
With minimal details and documentation, we ensure a simple and speedy used car loan process. Our wide network of branches at over 700 locations makes it super easy to access and super smooth to process your pre-owned car loan.
The Indian two-wheeler industry is one of the largest industries in the world. This is because purchasing a two-wheeler is the most convenient and affordable way to commute. The rural population depends on two-wheelers because of the convenience.
In addition to domestic companies, several international manufacturers sell two-wheelers in India. Most leading manufacturing companies are investing in this sector to take advantage of the huge demand for two-wheelers in the country.
Apart from the convenience and affordability, the easy availability of two-wheeler loans is a huge factor that drives rural demand. Here are five benefits of availing of such loans.
Lenders fund up to 80% of the cost of the motorcycle. This reduces your down payment, which is the amount you need to pay from your own resources while purchasing the bike.
Financial institutions offer such loans for a period of 12 to 36 months. The longer loan duration ensures you do not face any problems while repaying the loan amount.
If you are between 21 and 58 years of age, you may apply for a 2-wheeler loan. Lenders require basic documents, such as residential, income, and photo identity proof. In some cases, if you do not have an income proof but have other documents, you may still qualify for the loan. The entire procedure from loan application to approval is quick and easy. Lenders often process your loan within two days of receiving your application.
The interest rates on motorcycle loans are not very high. The affordable rate makes it easier for you to pay the Equated Monthly Installment (EMI). Moreover, a flexible repayment schedule ensures you have no financial difficulties while repaying the borrowed amount.
If you receive a lump sum during the duration of the loan, you may repay the borrowed amount before the loan tenure ends. Most lenders provide such facilities at a nominal pre-closure rate. It is important you check these charges before you prepay the loan. This will ensure you do not pay more than a reasonable amount while prepaying the borrowed amount.
Several two-wheeler dealers partner with financial institutions to provide quick and affordable loans to you. However, it is recommended you check with different lenders to ensure you do not pay a higher rate of interest. A lower interest rate reduces the amount you repay during the loan tenure. This may help you save a significant amount in the longer duration. Furthermore, lenders may levy additional charges, such as processing fees, legal expenses, and late payment penalties. All these extra charges may increase the actual cost of availing of a motorcycle loan. It is important you clearly understand all these charges to reduce your financial burden.
You may apply for a loan online or visit the lender’s nearest branch. Reputed and reliable lenders hire experienced personnel to assist you during the entire loan application and approval process. You must understand all the terms and conditions before signing the agreement and opt for a loan based on your repayment capability. With the help of affordable two-wheeler finance, you may easily purchase your dream motorcycle.
Owning a home is probably your biggest dream and achieving it is now possible with a housing loan. Such loans are available for constructing a home or buying a ready or under-construction property. You may also opt for a loan to renovate your existing home.
Most banks and non-banking financial companies (NBFCs) offer such loans. Here are five steps to avail of a housing loan in India.
The eligibility criteria differ from one lender to another. Generally, lenders consider your age, income, savings, employment status and consistency, as well as assets and liabilities to determine your eligibility for a home loan. You may check your eligibility on the lenders’ website or visit the nearest branch before submitting the application.
The next step is to submit a duly filled application form. If you are unable to complete the form, you may seek help from the lender’s representatives. You will also need to submit your documents along with the application form. These documents include income, age, residential, and photo identity proof, latest photographs, and property-related documents.
The lender will assess your various documents and application form to determine your repayment capability before approving the loan amount. Most lenders sanction up to 75% of the property cost excluding the land cost (in the case of self-construction). The financial institutions also undertake a legal verification of the property to ensure there are no encumbrances on it. An independent property valuation is also undertaken before approving your loan application.
After checking the property title and your documents, the lender will issue a sanction letter. The letter provides details on the loan amount, tenure, and interest rate. Once you accept the sanction letter, you will sign the home loan agreement. This agreement includes all the terms and conditions governing the loan. You will have to submit the original documents to the lender.
After you sign the agreement, you must pay the stamp duty and register the sale agreement. The lender will disburse the entire amount for ready possession property. However, if your home is under construction, the disbursement will be according to a pre-determined schedule.
Now that you know the procedure, here are three factors related to housing loans you must know.
Such loans are available for a maximum period of 20 years. You may opt for a shorter duration if required.
You may repay the borrowed amount either in monthly, quarterly, or half-yearly installments. The equated monthly, quarterly, and half-yearly installments comprise both the principal as well as the interest amount.
Interest may either be fixed or variable. With a fixed interest, the rate is constant during the entire loan tenure. However, the rate may be revised at the end of three years in the case of changes in the overall market interest rates. Variable interest changes according to the fluctuations in the money market rates.
Buying a home with a loan is not difficult; however, you must borrow according to your income. Opting for a loan is beneficial as you do not need to provide additional security while availing of a housing loan. The lender will create a mortgage on the property and retain all original documents until the end of the loan tenure. Moreover, you may prepay the borrowed amount earlier without incurring any penalties.
If you have never sold a car before, it may seem like a daunting task. You need to lay out a plan with strategic steps to get the best price for your car.
You will need to list your car, answer calls from potential buyers, give test drives, and finally close the deal. The entire procedure can be exhausting and time-consuming.
Here are four tips to ensure that you are able to procure the best price for your car:
A car that looks good and is in a good condition makes it easier to procure the best price. Prospective buyers would be willingly to pay a higher price if your car is well-maintained. Moreover, if the new owner requires a pre-owned car loan, the institutions would be more willing to sanction the application when the vehicle is well-maintained. You must get the car cleaned both from within and outside and repair any dents or cracks.
To attract more buyers, you must list your car online along with the relevant details. You must also upload a few high-resolution photographs from various angles to show the car’s exterior and interior condition. Also, list the ownership details, insurance type and validity, certification, and other related details.
It is important that you determine the right price while listing your car. You may look for similar listings to know the prevalent market price. You may quote a higher price and then negotiate it to a reasonable amount. If your car is maintained well, you may be able to justify a higher price. Even if a few buyers are driven away by the higher price, do not be disheartened because an online listing often garners huge interest.
If your car insurance is valid, the same must be transferred to the new owner. However, if the insurance has expired, the potential buyer must be informed since it also affects the buyer’s used car loan application. Ownership transfer costs are minimal and the local Road Transport Authority (RTO) may be able to assist you.
It may be advantageous to get an unbiased assessment of your car before listing it for sale. Taking the time to rectify the minor defects will help you to get the best price for your car. It will also make it easier for the buyer to procure a loan for used cars, which may quicken the entire procedure.
Since the start of the 20th century, the Indian used car market has seen tremendous growth. Currently, one pre-owned car is sold for every sale of a new vehicle. The market size is expected to witness a Compounded Annual Growth Rate (CAGR) of 15.2% and may reach USD 75 billion by 2023.
There are many reasons why the used car market in India is witnessing a steady growth. Here are four trends in the used car market:
Previously owners retained their vehicles for longer periods like six to seven years. However, technology is rapidly developing due to which newer models are released in short periods. Moreover, many urban families own more than one car, which reduces their usage ensuring these are maintained well. This allows individuals to avail of a car loan to buy a used vehicle at affordable prices.
Between 2005 and 2007, the Indian used vehicle market was controlled by the unorganized players that owned almost 95% of the total segment. The market share of organized players was only 4% during this period. However, the share of organized players has increased to 15% in 2010 – 2012 and the same is further expected to increase to 18% by 2021. Therefore, consumers are more confident about the quality of the pre-owned vehicles. Moreover, these organized vendors assist buyers to avail of a used car loan, which contributes to the rise in the demand.
In the past, society perception was not favorable when an individual opted to buy a used car. However, this is slowly changing and a higher number of people are no longer worried about owning old vehicles. The quality of these pre-owned cars is good with ownership reducing to shorter periods. Moreover, if a person is a new driver owning a used car is prudent until he is more confident about his driving skills. The easy availability of pre-owned car loan makes it easier to own a vehicle.
The economic slowdown has reduced the sales of new cars. However, the used car markets have seen a rise. The increasing fuel price is another reason why the sale of pre-owned vehicles is rising. Buyers would like to reduce their total car ownership expense by decreasing the loan for used cars amount thereby reducing the monthly installment.
As acceptance grows, the sale of used cars is increasing. More and more buyers find this option more affordable and see a true value for money in it.
Financial institutions provide loans to farmers to purchase new or used tractors. The tractor may be used either for agriculture or for commercial purposes. Such loans have several beneficial features as listed below:
The entire procedure to apply for tractor loans is simple and quick. You may either apply online or visit the nearest branch. Here is how to apply for a loan:
The eligibility criteria may vary from one lender to another. However, most lenders may require you to own a certain minimum acreage of land to be eligible for a tractor loan. Moreover, you must have adequate income to ensure you are able to make timely payments on the borrowed amount.
The documents needed for such loans are minimal and not complicated. You need to submit the Know-Your-Customer (KYC) documents and proof of income to apply for a tractor loan from Mahindra Finance.
When you apply for the loan online, you must provide some basic details. These include your personal information such as name and birth date along with your contact details. You will have to have to submit employment type, income details, and the loan amount required to enable the lenders to process your tractor finance application.
Before you make your decision, it is important you check all the terms and conditions. You need to determine the rate of interest, the repayment tenure, processing fees and other charges, and monthly installments to ensure there are no surprises in the future.
The demand for finance for tractors is slowly rising due to its easy availability and hassle-free procedure. The documents required are minimal, which reduces your efforts and saves time. More importantly, you do not need to provide additional collateral like land to avail of such loans.
Several lenders provide these types of loans and it is recommended you compare various institutions to make an informed decision. You may research online to compare different lenders, check terms and conditions, and other details prior to applying for a loan.
If you want to buy a tractor, apply for a loan today and achieve your dreams.
If you are planning to buy a used car then you are in for some work. A used car surely has the benefit of being more affordable. However, you need to find the one that is in the best possible condition. You also have to get the right used car loan so that you do not have to overpay in interests. All of these require some planning. You cannot afford to make mistakes. Here is a list of the common mistakes people make while availing of a used car loan.
Finding the best loan option for buying a used car requires you to spend some time researching about the lenders. Many lenders will offer you a good contract on the loan, but only one of them will offer the best deal. You need to spend some time online comparing the interest rates and down payments of the loans. Find a balance between the reparation of the lenders and the benefits of the loan. You should not just settle for any lender to get the cheapest loan. However, refrain from selecting the most popular lender who charges a high- interest rate.
A proper used car valuation is the first step of buying one. Do not just rely on your instinct for this process. Once you decide on which model of car you want, look for the used car seller near you who has that particular car. Visit the showroom and see the car for yourself. First, check if the interiors and the exteriors of the car look in decent shape. From the music system and air conditioner to the tires, check every aspect of it. Ask for the paperwork and maintenance history of the car. Find out if the car had ever been in any accident, and what repair work it had needed.
The second-hand car loan you have taken requires you to pay interest on a regular basis. You surely do not want to use the money to buy a used car that is less than adequate. A thorough inspection of the car is required before making any final decision. It might be a smarter decision to hire a third-party car inspector. They can help you to figure out if the car is worth the buy. The final step is to take the car for a test drive before finalizing a deal. Get a feel of the vehicle while driving it. That always helps to make the right decision.
Not everyone can negotiate well, but that does not mean you should pay whatever the car dealer is asking for. You should not pay more than the used car finance you have from the loan you have taken. Try to get the best possible deals on the car before completing the paperwork-related formalities. The car’s insurance and the registration document have to be transferred to your name before you can legally own it.
Only when all the above steps are completed, you can be sure of getting the best out of the entire deal.
A commercial vehicle loan is available to any individual or organization, which is planning to buy a commercial vehicle. These loans are often costlier compared to personal vehicles; hence, you will need a loan that can help you finance the purchase. Before you apply for the loan, here are a few things that you need to know about.
Eligibility
The commercial vehicle is a necessity for many businesses, especially for the delivery and transportation-related companies. Such people can apply for the loan:
The application process
Applying for commercial vehicle loans is quite simple, just like any other loan offered by a financial organization. Either you can visit their branch to ask for an application form or you can visit their online portal to find the same.
You need to fill the form with your personal and professional information. You also have to provide them with your address and contact information. Once done, you need to submit the required documents so they can verify your information. For the online procedure, you can upload the scanned copies of the documents too. If your loan application is accepted then your lender will ask you to complete the verification procedures and other formalities.
Required documents
To get the commercial vehicle finance, you must submit the following documents with your loan application:
Loan tenure and amount
The amount of loan you can get for the commercial vehicle depends on your requirements. Sometimes, your past relationship with the lender can determine the amount too. Most lenders provide up to 100% of the price of the vehicle you are buying. The loan repayment tenure can be anything from six months to five years.
Interest rate
The interest rate can vary depending on the lender. The rate of interest for these loans can be 10-15% or more. It also depends on your credit score, business turnover, the number of vehicles you already own, your relationship with the lenders, and other factors. You can use a commercial vehicle loan EMI calculator to get an idea.
By using the commercial vehicle loan calculator, you can get an idea about the monthly installment amount that you have to pay. However, you also need to keep in mind that you will be charged a processing fee. It is charged when you are applying for the loan, and it is not refundable. The amount depends on the value of the loan.
Buying a car of your own is a ‘dream come true’! When you are young, owning your first car can be identified as a symbol of success. However, purchasing a vehicle is not a cheap affair. If you have just started working then you probably do not have enough savings to afford a car. This is where a car loan comes in. The loan can help you with the finance at the time of purchase and you can repay the money over a long period of time.
In India, the loan for a vehicle comes in different basic types as listed below.
This loan option is available for people who want to buy a brand new car. The loan can be taken to buy any car model from any maker. You will have to pay an interest of 9-14% per year over a period of one-seven years.
The truth is that not everyone can afford to buy a new car, even with a loan. The good news is that you can always purchase a used car with the help of a used car loan. Most lenders will finance up to 85% of the car’s price. You will need to pay a yearly interest of 12-18%. You will have one-five years to complete the repayment. However, to get a loan for the previously owned car, the vehicle has to be less than five years, and, at the time of the loan’s maturity, the car cannot be more than ten years old.
A business organization or an individual, who owns a business that requires cars, can opt for a commercial vehicle loan. This kind of loan comes with a 10-15% interest rate that you will have to pay yearly over a period of six months to five years. The amount of loan you can get depends on your business’ yearly turnover and the number of cars you already own.
Not everyone wants to buy a four-wheeler; some people love a bike more than a car. If you are a bike enthusiast then the two-wheeler loan will help you get one. The loan for two-wheelers comes with a yearly interest rate of 11-18% on the amount paid for the bike. You have to be at least 18 years of age to avail of the loan. However, some lenders require a minimum age of 21 years.
The tractor loan is available for people or organizations, which have a regular source of income from any agricultural activity. It is also available for people who want to rent tractors as a business. The tractor loan is available for a yearly interest of 12 % on the loan amount. You have to pay a monthly interest for five years to complete the payment.
When applying for a loan to buy any kind of vehicle, be careful about which lender you choose. Spend some time comparing your available options before settling for one.
If you are in an agricultural business then you know it more than anyone else how important owning a tractor is. The tractor not only simplifies your farming job but it also helps add productivity to your business. Getting a new tractor can be a costly affair but it can be made less worrying with a tractor loan from a trusted lender. This loan is also available for people or businesses who want to enter the tractor renting service.
Eligibility
The eligibility criteria can differ from lender to lender. However, the same can be divided into two categories, for farmers, and for non-farmers.
Farmers:
Non-farmers:
Expenses
The annual interest rate for the loan can vary from 13-20% depending on your lender. You will also have to pay a processing fee of up to 4% of the total amount of loan sanctioned. This fee can differ for different banks or other lending companies. If you ever fail to pay the interest on time, you will have to pay a penalty fee of 2% over the regular Equated Monthly Installment (EMI). Other than these, lenders can include other charges, which will be mentioned in their paperwork. You can use an online tractor loan EMI calculator in order to get an idea about how much you have to pay in order to recompense the debt.
Benefits
The tractor finance comes with many great benefits. Here is a list of a few that will convince you of its effectiveness:
With the tractor loan calculator, you can check the benefits across different lenders in order to easily find the best possible choice for yourself.
Getting a personal loan against your assets is a very common practice. One of the securities you can use is your vehicle. If you are going through some financial difficulties then maintaining a car can be very challenging for you in any case. So, using that car to get a loan approved can work for you.
When you apply for a loan against a vehicle , the lender will hire an expert to determine the current market value of your vehicle. Most lenders offer loan up to 70-85% of the determined value of the car. Once the loan application is approved, the lender will own your car and you cannot sell it before the loan is repaid. Depending on your lender, you can get up to two years for repayment. If you decide to repay the amount before the tenure of the loan is over, they will charge you a penalty.
Eligibility
To get an approval for a personal loan, you need to have a steady source of income and a good credit score. The respected lenders do not trust any applicant who does not meet these criteria. However, the eligibility criteria for any loan against a car are more flexible. Here are the points to keep in mind when you are applying for the loan:
Required documents
If you are expecting a good loan against a car interest rates then you need to make sure to apply from a lender who has a great reputation. They will require you to submit specific documents in the time of application. Here is a list of the most common ones:
The value of your car and the tenure of the loan are decided based on the maker of your car, the model, the age of the car, and if you have a car loan.
Finding the best lender to get your loan against car
Once you are sure that you meet the loan against a car eligibility requirements, you can start looking for reputed lenders. Take your time to compare the different loan providers to find the best option for yourself. Make sure that you maximize your benefits.
If you are planning to buy a new car this year, you have a stroke of good luck. In 2019, some of the most reputed makers are launching advanced cars in India. From the sports car to a family car, they are coming in all categories. You also have the best car loans available in the market so you do not have to put a dent in your savings. Here is a list of the cars you can consider.
Launch month: May 2019
Price: INR 8 lakh
This is a compact Sports Utility Vehicle (SUV), which will compete against the likes of the Maruti Brezza and Ford EcoSport. Unlike the cascading grille that can be seen in their newest models, Hyundai is using the rectangular grille design for this one. The car is expected to come to India with a square fascia.
Launch month: May 2019
Price: INR 70 lakh
This fourth generation X5 was announced by BMW last year. The car will come with a newer, more stylish design. It will be more loaded in terms of features and will have a larger body. The interior of this car model is expected to have everything that you expect from BMW. The instrument cluster has been fully digitalized.
Launch month: May 2019
Price: INR 8 lakh
This SUV is an updated version of its previous models. The enhanced features include ‘powertrain’ options. The front grille and bumper design have been revamped to provide the car with a better appearance. Features such as rear parking sensors, driver airbag, speed warning, and seatbelt warning have been added to the car. With a new car loan, you can own this car as soon as it comes to the market.
Launch month: May 2019
Price: INR 65 lakh
This is one of the most anticipated cars of 2019. The reason for that is not only the maker but also the fact that the Mercedes-Benz GLE is entering its second generation with this new model. The grille of this new model will be bigger than the last one, and it is getting bigger in dimension. The interior will have an infotainment system with a wider screen and a storage capacity of 825 liters. It can be expanded to 2055 liters if you fold the seats on the second row.
Avail of a car loan to buy your dream car
Everyone has a dream car in mind, but not all have the bank balance to afford it. However, a suitable car loan can definitely help you in fulfilling your dream. Financial companies offer a lump sum in the form of a loan to help you buy your desired car. The car loan interest rates are competitive right now among different lenders and you must benefit from that. To find the best deals, use an online car loan EMI calculator and apply for a loan from the best lender that you can find.
Small businesses require funding at various stages – while getting off the ground, managing operations, maintaining inventory, upgrading equipment, and even recovering from losses. When running a Small and Medium-sized Enterprise (SME), it is imperative to optimise available resources in the best possible way. Sometimes, however, this still may not be enough to keep things running smoothly.
In such a scenario, some extra cash flow can go a long way. While there are several ways to fund your business, a small business loan or SME loan, can be the ideal solution to help steer things in a new direction.
There are many tangible benefits to taking such a loan. Here below, we list some of the most important ones.
Easy & Quick
With the world going digital, business loans have become much easier to access. In fact, today, many banks and lending institutions offer such loans without collateral. This makes it easier for small businesses to sustain their ventures. Further, the online application process for availing this facility is simple – with minimal steps and documentation.
Flexible Repayments
Nowadays, SME loans come with flexible repayment options. Banks and lending institutions usually understand the complexities attached to running a small business. As such, they offer flexible terms and conditions. They may allow an increase or decrease in EMI based on the financial condition of the company, and also allow bullet payments for periodic payment.
Low Rates & Charges
The interest rates for SME loans tend to be lower, especially in the case of government-backed schemes. Such loans are typically designed for public welfare. Overall, several factors are taken into account before disbursing the loan. These aspects include credentials of the borrower, tenure of the loan, business model and balance sheet of the company. Once approved, there are nominal one-time costs attached to the loan, such as processing fees.
Business Development
The required cash flow can help grow and expand your business. With stronger finance, manpower, technology and equipment, you have all the tools necessary to take your vessel to the next level.
Tax Benefits
Lastly, and quite importantly, you receive tax benefits under the Income Tax Act, wherein a part of the profit used for repaying the loan amount is exempt from tax.
Nowadays, especially for small establishments, business loans have become the order of the day. Along with all the unique benefits and features offered, they are also increasingly easy to take and repay.
If you are a growing Micro, Small & Medium Enterprise (MSME), it would be handy to know that you can always count on an MSME loan for your business needs. And, for the best loan rates, you should check out the Mahindra Finance SME loan plan.
Small business lending is more complicated when compared to individual loans. Such lending allows Small and Medium Enterprises (SMEs) to carry out their business operations smoothly. Often, these loans provide incentives that help the SMEs to reduce their costs.
Various financial institutions offer such loans for up to three years for meeting different fund requirements and may be customized to meet the specific needs of your business. Different lenders have different eligibility criteria.
Here are some basic eligibility criteria you have to meet to apply for small business loans:
Required documentation
The documents required to apply for business loans are simple. Here is an indicative list of documentation:
Before you apply for Mahindra Finance SME loan, it is recommended you do the following:
It is important you have a detailed and robust business plan before submitting your application. This is crucial to convince the lenders that your proposal is financially viable. The business plan must include details such as capital expenditure, employee and marketing costs, and debt repayment capabilities.
You must check that your credit report is updated and accurate. Having a good credit history is favorable when you apply for an MSME loan (micro medium and small enterprises). Lenders review your credit report before approving your application.
Your business plan must include financial projections for the next three to five years. It is recommended you adhere to industry standards while doing the projections. You may also have to follow certain formats that help the lenders determine the financial feasibility of your business.
Such loans are available at competitive rates of interest and may be structured as per the specific needs of every borrower. Lenders also offer various repayment options to ensure you are easily able to service the loan.
Whether you are an entrepreneur or an existing business owner, it is possible that you require external finance. You need funds to buy equipment, meet working capital requirements, or expand your business.
In case you require funds, you may choose from multiple loans offered by the many financial institutions in India. With several available options, making the right choice may seem confusing. If you are not cautious, you may work with the wrong lender and face severe consequences.
Here are some basic questions that you must answer before you apply for a business loan.
After answering these questions, you may apply for a loan offered by the lenders. Here are three tips to help you choose the right loan:
Lenders offer different types of business loans to meet the various needs of borrowers. You need to review the purpose for which you need funds, such as meeting working capital, a line of credit, vendor financing, or others. Moreover, you need to understand how much of the fund requirements may be self-financed. This will help you narrow down potential lenders.
Whether you are a Micro Small Medium Enterprise (MSME), Small Medium Enterprise (SME), or a large, venture you need to meet certain eligibility criteria. It is recommended you check these criteria to understand if you qualify for a Mahindra Finance SME loan or not. Moreover, you must also check terms and conditions, interest rates, loan tenure, processing fees, and other charges before you avail of a loan. Knowing the repayment schedule prior to disbursal will help you plan your finances properly to ensure that you are able to make timely repayments on the borrowed amount.
Lenders may take a few weeks to several months to process your SME loan application. It is recommended you check the processing time with the prospective lender to ensure you receive the funds when required.
Use online financial platforms to compare various lenders and to procure an affordable interest rate. Adhering to the aforementioned tips ensures the procedure to apply for an MSME loan is quick and hassle-free. It is crucial to work with a reliable lender to avoid any issues in the future.
The most important factor to start a business is the capital. The basic fact is that the more capital you have for your business, the more your business will succeed and prosper. The best way to get capital for your business is through a business loan. There are different ways you can grow your business through a loan. SME loans are available for different types of businesses and for various purposes in the business. Here is how you can use the funds to grow your business.
You will need to do a lot of planning and funding to expand the business. Hence, if you have a well-defined plan but are lacking with money, an SME loan can help you grow your business. With this amount, you can increase the staff, inventory, and purchase new machinery.
The backbone of any business is its infrastructure. It varies from business to business. You can use the funds from the loan to get an additional space to store inventory or to move to a bigger office. As your business grows, infrastructure will be a primary need and a small business loan will help you fulfill the same.
Having adequate inventory is important if you are running a small business. You will be able to meet the demands of a consumer only if you have sufficient inventory. Loans for small business can help you meet your needs related to inventory. In addition, you can increase the production, which will eventually lead to an increase in the business.
With a small business loan , you can suitable human resources for your business. The productivity of the business will increase if you hire qualified specialists and pay them a higher salary.
Every business requires working capital to maintain the operations. Sometimes, you come across a down phase in the business due to many reasons and this is when an SME loan will help you. You can use the loan to cover the operational expenses and ensure that you do not have to pay for the same from your pocket.
With an SME loan, you can manage to grow your business by building a website and allocating more funds to the marketing activities. You need to do online, as well as, offline marketing to get more leads and acquire more clients in order to take your business to the next level.
It is important to carefully decide where you want to utilize the money and examine the choices that you have. When you know the purpose of borrowing, you can borrow the right amount and use it in the most appropriate manner. Once you know the amount of money you need in the business, you can approach the right lenders and take your business to greater heights.
Every size and type of business requires funds to operate. Whether the founders pool money or they raise funds from financial institutions, no business can sustain without adequate capital. The capital requirements also vary according to the size of the business. There are many types of business loans available for business owners. Business loans can be categorized into short-term, long-term, secured, and unsecured. Long-term loans, as the name suggests is a loan with a longer tenure and a short-term loan has a short duration. A secured loan is a loan, which has a collateral requirement and an unsecured loan has no such requirement.
However, when it comes to a loan for business, there are two main types—professional loan and trade loan.
Designed for self-employed individuals like lawyers, chartered accounts, and doctors, professional loans allow individuals to start or run their business. Such loans have a certain limit on the amount of funds that can be extended to the borrower. They are usually long-term in duration with a payback tenure ranging between five to seven years. The documentation required for this loan will vary depending on the lender.
A trade loan is designed to meet the needs of every size and type of business. The loan can be divided into three types—overdraft, term loan, and working capital loan.
An overdraft loan is based on some securities in bank fixed deposits. Depending on your credit history, repayment history, cash flow, and relationship with the bank, the lender will take an approval for a specific overdraft limit. After approval, the overdraft amount can be used and the interest is supposed to be paid to the bank only on the amount you used. You can use the funds as per your requirements. However, you need to pay the interest and principal amount on time.
This loan is provided to your business as working capital and is issued against collateral. It has a lower interest rate as compared to overdrafts and the interest will be charged on the amount utilized by you. In this type of borrowing, you can utilize the money only to manage the daily operational requirements of the business and not for any other reason. This form of business finance will give control to the lender to monitor your cash flow, debtors, inventory, and receivables, among other aspects involved in business operations.
This is a standard and very popular option when it comes to loans for small business. It can be availed for personal, as well as, business purposes, and the total amount will have to be repaid over the tenure in Equated Monthly Installments (EMIs). Term loans can also be taken in a foreign currency and hence they are known as foreign currency loans.
Consider the purpose of borrowing and then decide on the type of loan you require. You will have to submit the requisite documents and ensure timely repayment of the loan in order to maintain a positive credit history. Business loans allow entrepreneurs like you to take their business towards progress without worrying about the lack of funds.
When planning for your financial goals, it is important to align them with a strong financial plan. To help meet these goals, you can invest your savings in reliable and rewarding avenues such as Fixed Deposits (FDs).
FDs, or term deposits, are a crucial component of any well-balanced portfolio. They are secure investment instruments that offer guaranteed returns.
In this scheme, you deposit a certain sum of money for a fixed time period at a pre-determined rate of interest. The timeline for this could range from a few weeks to a few years.
If you are looking to find the best FD scheme, and get the maximum returns out of your investment, here are a few things you need to keep in mind.
Interest rate:
Different lenders offer different fixed deposit interest rates Before investing in a fixed deposit, it would be wise to scout for the best interest rate available in the market.
Tenure:
The tenure on an FD ranges from 7 days to 10 years. Generally, the interest rate you are offered will depend on the term you choose. As such, longer deposits are likely to earn a higher rate of interest.
Lender’s credibility:
Before finalising your FD details, it is important to verify the lender’s credibility and standing. Agencies such as India Ratings & Research (Ind-Ra), Credit Rating Information Services of India Limited (CRISIL), Credit Rating Agency of India Limited (ICRA) and Credit Analysis and Research and Investment (CARE) provide a reliable reading of the lender’s credit rating.
Payouts:
Depending on whether you want periodic returns or interest at maturity, you can opt between cumulative and non-cumulative FDs. In non-cumulative FDs, payouts can be made on a monthly, quarterly, semi-annual or even annual basis. In cumulative FDs, the interest is compounded and a payout is made at maturity, on completion of the tenure. As such, these FDs offer you higher interest payouts.
Early exit charges:
Fixed deposits come with a lock-in period, which means you cannot withdraw the money prematurely, before the term ends. However, if you do so, there could be a penalty to pay. While choosing an FD, find out the price you may have to pay for its early liquidation.
Senior citizen benefit:
Senior citizens usually receive better rates of interest for FDs. Usually, the interest rate offered to them is 1% more than usual. If you’re a senior citizen, you should find an FD that offers you the best rate.
Simple process:
Lastly, when selecting a lender, ensure their application process matches your preferences. Nowadays, people generally prefer a simple online process, with minimal steps and documentation.
With assured returns and zero volatility, FDs have become attractive investment avenues for investors. When looking for the best fixed deposit schemesin the market, it is important that you keep the aforementioned points in mind.
By making the most out of your investments, you can plan a worry-free future for the family.
Depositing additional funds are always welcomed by any bank, but, you as a customer are always muddled whether to store it in a Savings Account or a Fixed Deposit (FD) account. A head-on comparison between the two will reveal that the interest rates are higher on the FD side, which successfully culminates into a good return on investment (ROI).
You may also opt for mutual funds or shares; however, these are risky. A safer option that provides decent returns includes fixed deposits (FDs).
Here are six reasons to open FDs.
Compared to shares or mutual fund schemes, FDs are safer. Furthermore, such deposits are rated by credit rating agencies like India Ratings & Research (Ind-Ra), Such ratings ensure your funds are safe and there is no risk of losing your capital.
Compared to a bank savings account, the fixed deposit interest rates are higher. In addition, financial institutions offer a greater rate for senior citizens when they open an FD. Therefore, you will be able to earn more on your capital.
You may invest as low as INR 5,000 while opening an FD. In addition, you may choose a cumulative or non-cumulative option. When you choose cumulative FD, the interest is paid on maturity. On the contrary, non-cumulative FDs provide regular interest payments and are beneficial to earn periodic income.
When you open an FD, you must choose the duration of the deposit. At the end of this period, you will receive your capital along with the interest. Moreover, most financial institutions allow you to withdraw your funds prior to the end of the deposit period. However, according to the Reserve Bank of India (RBI) rules, you are not allowed to withdraw your money within three months of opening the FD. In the case of premature withdrawal, the effective fixed deposit rates may reduce because you do not hold the FD until maturity.
You may avail of a loan facility against your FDs. Financial institutions offer up to 75% of the deposit amount as a loan after three months of opening the FD. The interest rate on such loans is affordable, thereby ensuring you do not face any difficulties in repaying the borrowed amount.
Some FDs provide tax benefits. Usually, when you opt for a tax saving deposit, you will have to hold the FD for at least five years. You are unable to withdraw the money before the end of this period. Furthermore, loans are also not available on tax saving deposits. When you opt for these deposits, the capital invested up to INR 1.5 lakh is exempt from income tax under Section 80C of the Income Tax (IT) Act, 1961.
Several banks and non-banking financial companies (NBFCs) offer such time deposits. It is advisable you check the interest rates offered by different financial institutions to maximize your returns. FDs have been popular among Indians who want to invest their money in a safe financial instrument. Such deposits are regulated by strict laws and offer assurance to investors like you. Investing in FDs is advisable if you want to increase your income through another source.
One of safest and most sought-after investment instruments in the market today, Fixed Deposits (FDs) offer guaranteed returns, while also helping you meet your financial goals.
FDs can be categorised as cumulative and non-cumulative. In each form, the interest is payable at specified frequencies.
Cumulative
In a cumulative fixed deposit scheme, the interest amount is compounded over the term of the deposit and paid at maturity. Longer deposits generally earn higher FD rates.
For instance, if you invest Rs. 1,00,000 in an FD with a bank at a 10% rate of interest for 1 year, you would receive Rs. 1,10,000, which is the principal amount plus the interest earned, at the end of the year.
Non-Cumulative
On the other hand, in a non-cumulative scheme, the interest amount is payable on a monthly, quarterly, semi-annual or annual basis.
Let’s say you place another FD with the bank. Only this time, you choose the non-cumulative interest option. Here, you get to choose the frequency of your periodic payments – be it monthly, quarterly or annually.
This means that if you’ve made a deposit of Rs. 1,00,000 at a rate of interest of 10% for 1 year, coupled with quarterly payouts, you will receive Rs. 2,500 each quarter.
Different lenders offer different fixed deposit interest rates. Depending on your requirements and future financial goals, you can opt between a cumulative and non-cumulative FD of your choice. The only point of differentiation between the two is the periodicity of interest payments. While cumulative schemes offer a single outgo of interest, non-cumulative schemes offer periodic interest payments.
How to Choose Between the Two
Salaried individuals, or small business owners, who don’t necessarily need any added income to meet their monthly expenses can easily opt for a cumulative FD. By saving a larger amount, the corpus built using a cumulative scheme can also help meet long-term financial goals.
For retired individuals and pensioners, who don’t have a steady source of income, non-cumulative FDs are a better bet. They provide periodic payments on a regular basis, allowing such individuals to better plan their day-to-day and monthly expenses.
Irrespective of which section of society you belong to, an FD, can help you build a better corpus for the future. In fact, they are the most preferred form of investment to help individuals meet their long-term financial goals.
Learn more about fixed deposit .
The best way to build your wealth is to invest wisely. As a part of this financial exercise, you can keep some portion of your savings in Fixed Deposits (FDs). These secure investment instruments offer assured returns at an attractive rate of interest.
Moreover, they offer multiple benefits such as flexible tenure, easy online application and a high safety rating. Depending on your risk appetite and goals, you can also leverage a fixed deposit by taking a loan against it.
Here below are five sturdy reasons as to why you should invest in an FD:
Safe and Secure
Most market-linked instruments are volatile, and are easily affected by the current economic scenario. However, such is not the case with FDs. When you invest in an FD, your principal amount and accumulated interest, are both secure despite fluctuating market conditions.
Guaranteed Returns
When you put money in an FD, you know exactly how much you are going to earn through the term, or at maturity. With the assured principal and accumulated interest on hand, you can better plan for your longer-term financial goals.
Easy Liquidity
In case of an emergency, you can easily withdraw the money from your FD before maturity. In such cases, a penalty may be levied for breaking the deposit, but all in all, the process is quite simple. Most importantly, this facility helps dispense funds during a financial crisis or time of difficulty.
Flexible Tenure & Payouts
FDs offer full flexibility with regard to the term of investment. It could range from 7 days to 10 years. An investor can select any time-period that suits his needs. Further, FDs let you choose between cumulative and non-cumulative interest rates.
While non-cumulative FDs offer periodic payments on a monthly, quarterly, semi-annual or annual basis, cumulative FDs give you compounded interest at maturity.
Loan Against FD
If you hold an FD, you can also use it to leverage a loan when you need one. Usually, you can avail a loan up to 70% of the FD amount, that too at a competitive rate of interest.
In this day and age, a fixed deposit scheme is a safe and secure avenue to invest your savings. With assured returns and zero volatility, you can continue to build your wealth and create a sizeable corpus for your family.
If you’re searching for the best FD rates in the market, be sure to check out the Mahindra Finance fixed deposit. It offers the most competitive rates along with a bucket of future benefits.
In India, fixed or time deposits have been popular for many years. One reason is that these products are a safe investment option. In addition, these deposits offer a higher rate of interest when compared to a savings bank account.
Before you decide to invest in such deposits, it is important to debunk some myths. Here are five common myths related to these deposits that you must stop believing.
This is one of the most widespread myths about fixed deposits (FDs). However, the fact is that even non-banking financial companies (NBFCs) offer such deposits. Generally, NBFCs offer a higher rate of interest on FDs. You may also enjoy different tenure options and flexible repayment schedules. FDs offered by NBFCs are secured as these are rated by credit rating agencies like Credit Rating Information Services of India Limited (CRISIL).
Interest earned on FDs is taxable at your income tax slab rate. The returns you earn is added to your total annual income under the heading ‘Income from Other Sources’. However, if the interest earned through FDs is not more than INR 10,000 during the entire financial year, there is no Tax Deducted at Source (TDS) implication.
There are certain types of tax saving FDs that offer income tax benefits. You need to remember that when you opt for such tax saving deposits, you will need to lock your money for at least five years. The tax benefits are available under Section 80C of the Income Tax (IT) Act, 1961.
The fixed deposit interest rates are pre-determined. You may choose to receive the income at periodic intervals or opt for the cumulative option. With regular payouts of the interest income, you earn less because there is no compounding. Compounding means that you are able to earn an additional income on the interest that is reinvested in the FD. It is recommended you opt for the cumulative FDs and receive the interest income at the time of maturity.
You may consider taking out your money from the FD before its maturity date to meet emergency cash requirements. However, this reduces the FD interest rates and delivers a lower return on your investment. Often, the financial institutions levy a penalty on premature withdrawal. It is advisable to opt for either a loan against the FD or an overdraft to meet immediate cash requirements. Most financial companies offer such facilities.
Opening an FD is quick and simple. You may invest as low as INR 5,000 in these financial products. Moreover, minimal documents are needed for opening an FD, such as photo identity and residential proof. You need to issue a cheque or a demand draft for the FD amount at the time of opening a deposit. You may also include two joint holders while opening the FD.
FDs have been popular for several years and the above-mentioned myths often prevent individuals from investing in these products. Get your facts right and invest in FDs, the safest investment product today.
Fixed or time deposits are a common and popular investment option in India. These deposits provide interest higher than a regular savings account and are less risky than other investment options like shares.
You may open a time deposit account without any inconvenience with minimal documentation. However, premature withdrawal before the due date results in the payment of a penalty. If you want to invest in high-interest deposits, here are seven tips to keep in mind:
Different institutions offer varied interest rates on fixed deposits (FDs). It is recommended you check with various institutions to know the best rate available for your required tenure.
Based on the capital you want to invest, it is recommended you split the same among multiple FD schemes. Therefore, in case you require emergency funds, you may withdraw from one deposit while the balance deposits continue to earn returns.
The financial institutions link the interest rates to the repo rate. This means the FD rates may fluctuate during the tenure. This fluctuation may be countered by including multiple FDs with different tenures.
The returns earned on your FD investments are liable to the tax based on your income slab. It is important that you determine the tax liability before you invest in high-interest fixed deposit schemes.
Several tax-saving FDs are available, which have a lock-in period of five years. However, you are not allowed to make any withdrawal before its maturity date. Therefore, if you want the flexibility to break your fixed deposit prior to the end of its tenure, it is recommended you do not invest in tax-saving FDs.
In most cases, if you withdraw the money from an FD before its due date, you may have to pay a penalty. Financial institutions may allow you partial or premature withdrawal to meet emergency fund requirements before maturity by levying a penalty. The total interest may also be affected in such cases.
When you opt for this option, the interest is reinvested to your FD account. This allows you to earn higher returns through reinvestment. It is recommended you opt for this choice if you want to benefit from capital appreciation over the long-term.
FDs have been a popular investment option for decades. The low-risk and convenience of opening an account with the opportunity to earn good returns make these a popular financial choice.
Time deposits are risk-free investments that also offer the opportunity to earn good returns. Therefore, such deposits have been widely used by Indians since decades to earn a regular income and build wealth over the long-term.
It is important that you have the accurate information related to such investments to ensure you have a positive experience. Here are four common myths associated with time deposits that are busted:
When compared to banks, company fixed deposits (FDs) offer a higher rate of interest. You may consider these riskier; however, this is a common myth. You may compare the ratings for the company FDs issued by leading credit agencies. Mahindra Finance fixed deposits enjoy good ratings ensuring their reliability and stability.
Company FDs interest rates are guaranteed and remain unaffected by market rates. Moreover, senior investors may enjoy a higher rate of interest, which makes these a good investment option.
This is true only if the income in the financial year exceeds INR 5,000. This limit increases to INR 50,000 if you are a senior investor. Moreover, if you do not have other income sources or your total income is less than the minimum tax bracket, you do not have to pay taxes on FD income. To ensure that tax deducted at source (TDS) is not applicable, you must submit Form 15G or 15H.
Non-cumulative fixed deposit schemes allow you to choose the frequency of the interest payments. If you choose a monthly payment, it does not mean that your income will be higher. The financial institutions calculate the annual FD rates and these are then divided in equal installments based on your chosen payment frequency.
The interest rates on cumulative FDs are often lower when compared to non-cumulative deposits. The interest earned on your initial investment is reinvested when you opt for a non-cumulative FD. Therefore, such interest reinvestment provides the opportunity to build a good corpus in the long-term.
If you need to break the fixed deposit before maturity, the procedure is simple and quick. However, the institution may levy a premature withdrawal penalty and it is recommended you check this before breaking the FD.
When you invest in an FD, you will receive the principal investment along with the interest on the maturity date. However, the premature withdrawal amount will be deducted from the maturity proceeds. You may also avail of a loan against your FDs. All these features and benefits make FDs a popular investment option.
Fixed or time deposits are one of the most popular and oldest investment options. Compared to a regular savings or current bank account, the rate of interest on such deposits is higher.
Time deposits are recommended to mitigate the overall investment risk of your portfolio and counter the high-risk investment options like equities and mutual funds. Additionally, such deposits may be used to increase your income through regular interest payouts, which ensures you do not have any financial difficulties.
Here are five reasons why you must choose to invest in fixed deposits (FDs):
When you invest in stocks or equity-related mutual funds, the returns are linked to the overall performance of the markets. On the other hand, time deposits provide assured returns because the fixed deposit interest rates are pre-determined. FDs are risk-free investments. When you invest in FDs, you do not have to worry about market fluctuations. You need not focus on timing the markets. This allows you to concentrate on your job or business while earning good returns on your investments.
Compared to other fixed-income securities such as government bonds or treasury bills, the rate of interest offered by institutions on the FDs is higher. Additionally, the fixed deposit rates are higher compared to other types of bank accounts. Therefore, you have the opportunity to earn better returns with no risk.
Financial institutions offer different investment tenures when you choose to invest in FDs. You may choose as less as seven days to as long as ten years based on your preferred investment horizon. The FD rates vary for different durations, which make these very versatile.
Most lenders allow you to borrow funds against your FD holdings. Additionally, you may procure an overdraft facility against these investments.
Generally, a fixed deposit comes with a pre-determined maturity date. However, financial institutions allow you to liquidate your holdings before the due date albeit at a penalty. Therefore, contrary to common perception, FDs are liquid investments.
When you invest in five-year time deposits, your investment is eligible for tax benefits under section 80C of the Income Tax Act. Therefore, you can reduce your tax liability through such investments.
Often, some people argue that you are able to earn higher returns in products like mutual funds, derivatives, or shares. However, these are high-risk investments with the possibility of losing your entire capital. It is recommended that if you do not have a high-risk tolerance, investing surplus funds in FDs is a better option.
An ideal way to kickstart your investment portfolio is through a fixed deposit (FD). It is not only risk-free and easy to comprehend, but also helps you in growing your wealth. In an FD, your money is held for a specific tenure and you earn interest on it until the date of maturity. FD interest rates are higher than the rates that are offered in savings accounts, which is also a reason why FDs are very popular. The pros and cons of investing in an FD are discussed below.
Pros of investing in FDs
FDs are considered as an ideal way to start saving money for the future. Its benefits are discussed below.
FDs are not associated with market movement; hence, there is low risk. FDs provide guaranteed returns and are a preferred choice for individuals who have a low-risk appetite.
An FD scheme has a minimum tenure of six months and a maximum duration of five years. This means your money will be safeguarded and you will earn returns on it.
If you are in an emergency and need funds, you can simply take a loan against the FD without breaking your FD prematurely.
In an FD, you can select the desired term. Moreover, you can decide when the interest amount is credited to your FD account. You can choose between monthly, yearly, and at-maturity interest rate payout options. The fixed deposit interest rates offered are higher for senior citizens.
Cons of investing in FDs
FDs do have certain disadvantages, which also need to be considered. The cons of investing in an FD are discussed below.
The returns in an FD are guaranteed but the FD rates are low as compared to other market-linked investments.
If you withdraw the FD before its maturity date, you will have to pay a penalty charge. You could also get a low interest on your FD if you break it before the date of maturity.
The interest you earn on an FD will be a part of your taxable income. As per the Budget 2019, your interest earnings on FDs up to an amount of INR 40,000 will be exempted from tax. However, if you earn an interest income that is greater than INR 40,000 your income will be deducted by 10% Tax Deducted at Source (TDS). Hence, if you are looking for an investment option that provides complete tax exemption, then FDs are not the ideal alternative.
Many choose to invest in FDs over any other form of investment for the low risk and consistent return it generates. This is why it remains a favorite investment avenue for retired investors. The pros outweigh the cons when it comes to fixed deposits and if you are looking for a low-risk investment option, you must invest in an FD at the earliest.
The cost of living in the country is constantly increasing and Budget 2019 has offered positive signs for investors. The most important fixed deposit (FD) update is the removal of the traditional (Tax Deducted at Source) TDS deduction limit on FDs. This was a proposal by the Ministry of Finance, which has appealed to all the citizens of the country. In case of FDs, the interest earned up to an amount of INR 40,000 will be exempt from any TDS deduction starting this financial year. This is a major reform when it comes to FDs, as earlier the exempted amount was up to INR 10,000. It is this reason why you should consider FD as an investment this year.
Why is FD an attractive investment avenue?
The repo and reverse repo rate increased twice in 2018 and this meant stressful news for borrowers who had to go through an interest hike on their loan. However, it also meant good news for investors because banks, as well as, companies had to revise their fixed deposit interest rates. This hike was carried out to balance a rise in the cost of the loan. The rate hike has increased the faith of investors in FDs and has increased their investment significantly. This movement, which began in 2018, has turned highly significant with the TDS deduction nod in 2019.
The implementation of new tax slabs
As per the Interim Union Budget for 2019-20, there was a revision in the tax slabs for individuals and this meant that individuals earning an income up to INR 5 lakh in a year will remain exempted from tax. Further, those earning an income up to INR 6.5 lakh or more can claim deduction under certain sections and get a complete exemption from their taxable income. This means you can now allocate more funds towards FD investments to make the most of the new slabs.
You can now make the most of the FD interest rates and the tax slabs by making an investment in FDs right away. As per the external benchmark system, the FD interest rates will not see any more hikes and with the tax exemption for you, it is very likely that you will prefer high-interest FDs. You can make the most of FD rates in 2019 by opting for a reliable financial institution as compared to a bank. They offer lucrative interest rates and are an ideal place to put your money. If you are a current loan customer, you can also get an additional interest on the investment.
You can begin your investment with an amount as low as INR 5,000. You can choose from the different payout frequency options. There is a higher interest rate for senior citizens.
The above-mentioned factors ensure that FDs remain a preferred investment option for individuals across the country. Consider the income and align your goals to investments in FDs. In order to earn maximum returns, remain invested for a long period of time and ensure that you do not withdraw the FD before maturity.
In order to generate maximum returns out of an investment, it is essential to find the ideal fixed deposit (FD) scheme. There are a number of factors, which need to be considered before applying for an FD. Non-Banking Financial Companies (NBFCs)pay high FD rates as compared to banks. It is important to do some research before you put your money in an FD in India.
Factors to consider while choosing an FD
You need to keep the below-mentioned factors in mind when applying for an FD.
The most important factor to take into consideration is the FD interest rate. Choose a good deal by comparing the interest rates because it will make a huge difference to the returns generated on your investment.
Another factor to consider is the tenure. If you want to earn maximum return from your investment, you need to remain invested until the maturity period. Hence, choose the tenure wisely.
After comparing the FD rates in India, you will have to decide on the payout option. Consider the period when you would like to receive the interest. It could be monthly, quarterly, annually or half yearly.
Before you put your money in an FD, you need to check the penalty rate in case you want to break the deposit prematurely.
How to choose a good FD scheme
In order to select the most suitable company FD scheme, you need to follow certain below-mentioned steps to ensure that you make the correct choice.
FDs are considered as a traditional and secure investment option. They are low risk and generate consistent returns in the form of interest. Before you invest your money in an FD, understand the terms and conditions of the same. Make a wise choice and do not be simply driven by the rate of interest.
You do not need a complex solution to achieve success in business. Success comes from mastering the fundamentals of the business and understanding the point of view of the consumers. In order to run a successful business, you only need to address the need of the customers in a manner, which is better than the competitors. An analysis of the drivers of progress for small businesses signifies that there is a basic success formula for every type of business. If you can get the basics right, you will be able to take your business to greater heights of success and prosperity.
How to make your small business successful
Listed below are a few success formulas that you should follow in order to make your business flourish.
If you look at the customer perspective in terms of value equation, it comes down to benefit minus the cost. Many businesses are not aware of what could make their customer happy and they try to fit their customer to a product instead of identifying which product would fit the customer. To run a successful small business, you need to keep the customer at the forefront and then fit your product as per their needs.
Every customer is different and every customer is important for the business. Hence, you need to identify the customer you are targeting and then create a product or a solution for the target audience. If you try to be an ‘all things to all people’ business organization, it will benefit neither the customers nor your business.
After you have learned the value equation for your customers, you need to focus on finding many more customers who have similar product requirements. Many businesses try to scale the business before they have created a product. Loans for small business can help you achieve your marketing objectives in order to reach out to a wider consumer base. An SME loan is specially designed for small businesses and it serves multiple purposes.
The business model is crucial for achieving success. You need to build a business model, which grows the business and generates a high return on investment. However, you will not accomplish your business goals just by creating a business model. You also need to focus on the execution aspect. Build a team that believes in the business and will help you with the execution of the business model. When you build a business model, do not miss the basic steps and keep your audience at the forefront. If funds are a problem, you can apply for a business loan from a Non-Banking Financial Company (NBFC) and expand the business.
Nobody said running a business was easy but it is not complex either. With financial institutions offering small business loans at lucrative interest rates, it has become easier to establish and manage a small business. If you take the right steps and understand the perspective of the customers, you will be able to make your business successful in a short span of time.
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