Eligibility for Machinery Loan
Typically, you’ll need to meet the following eligibility criteria to successfully secure a machinery loan:
- You should be aged between 25-65 years old.
- Balance sheet assessed by a registered CA.
- You also need to present ITR of the past two years.
- Applicant must not have a past record of defaulting on a previous loan
- You will need to submit financial statements with your business showing an upward trend.
We suggest you consult a reputable business loan provider in India like FinDestination to find out whether your enterprise is eligible for the loan.
Other Documents Required when Applying for a Machinery Loan
- Photo identity proof like driving license, passport, Aadhaar card, etc.
- Documents of business proof like a sales tax certificate, trade license, etc.
- Certified bank statements of the past 6-12 months.
Types of Commercial Machinery Loans that Businesses can apply for in India
Indian business owners have a handful of options in front of them when it comes to machinery loans. They are as follows:
1. Business Loan for Machinery
These types of loans are basically unsecured advances that are offered to businesses so they can finance the purchase of new equipment. These loans can range from anywhere around a few lakhs to crores. These loans facilitate the purchase of most types of machinery, both small and large.
On the downside, however, these loans can be very difficult to acquire for small businesses. Some lenders only offer these loans to companies that possess a vintage of three years, maybe more.
2. Government Loans for MSMEs
SIDBI, aka The Small Industries Development Bank of India, which operates under the GOI’s department of financial services, offers a specialized loan to MSMEs called ‘SPEED’. A business that is registered under the MSME act can easily avail of these loans. On the other hand, businesses that do not fall under the MSME act will have a tough time securing this loan.
3. Gold Loans
Gold Loans are considered one of the most secure loan options to get. Such loans can allow businesses to maximize the utility of their assets by acquiring advance funds without having to go through the hassle of satisfying any eligibility criteria or lengthy documentation processes.