When Should You Avail An Instant Business Loan?

Aug 13, 2020

When Should You Avail An Instant Business Loan?

Businesses often undergo stressful circumstances, which are beyond the control of individuals. When such an emergency arises, the financial well-being of an enterprise becomes the primary concern. The current scenario presents the ideal example of such a financial emergency. Due to the Covid-19 outbreak worldwide, companies are suffering from a hurdled flow of finances globally.

Emergency business loans are thus ideal funding options that these hard-hit companies can resort to for resuming operations seamlessly. However, before learning the best option for recovery from such situations, here are four distinct scenarios that can quickly leave your established business in a financial predicament.

Financial Emergencies that Businesses Can Face

  • Losing a big client

Clients are the financial backbone of any business. While you may be in search of newer and better clientele, losing one or more of the existing ones can cost your company significantly. In fact, the loss of a major client can even lead a business to closing in on a permanent shut down due to restricted revenue opportunities. Under such circumstances, instant business loans can give your enterprise some time to readjust and resume normal operations.

Loss of client also creates liquidity strains, during which maintaining an enterprise’s day-to-day activities can be difficult. Access to emergency funds under such circumstances can thus help entrepreneurs alleviate some of this risk, and get their business back on track.

  • Unprofitable investments

A business operator often relies on investments to grow the venture’s assets. Nevertheless, a sudden dip in the market or backing the wrong equities can lead to substantial losses for a company. Such mistakes are common with even the most experienced investors.

Considerable losses through investments can exhaust a business’s working capital, which, in turn, may force them to lay off employees and cut other operating costs. Thankfully, instant business loans in the form of gold loans can come to your rescue at this point, minimising any financial damage that arises from the investment failure.

  • Natural disasters

Unprecedented natural disruptions like the Covid-19 situation can hamper millions of businesses across an economy. Several small entities found it difficult to survive and have completely shut down operations for weeks together during the lockdown. Similar disasters or natural crises can occur in the future as well, thus disrupting the regular flow of finances.

As per an ADB Economics Working Paper, India experienced 278 floods between 1980 and 2017, which led to estimated total losses of $58.7 billion. Thus, all businesses must draft a financial contingency plan in the event of such unforeseen calamities.

During natural calamities or unprecedented market hustles, demand for essential products and services tend to spike. Thus, businesses need to stock up on inventory, even amid the financial turmoil. One of the ways to achieve this during a financial crunch is by opting for instant business loans from reliable lenders.

  • Loss of business funding

A business greatly relies on its investors for additional infusion of finance when facing issues. Nevertheless, an investor may back out from the deal midway, leaving your company severely underfunded. While an experienced entrepreneur can minimise funding loss by picking reliable sources of finance in the first place, one can never truly predict whether an investor is willing to stick with your business through thick and thin.

Such financial crises can significantly hamper your company’s ability to retain employees due to fund shortage. Businesses often opt to lay off staff at such junctures in a bid to reduce expenses during a liquidity crisis. However, doing so can be detrimental to a company’s image and market reliability. The next best alternative under such a scenario is to seek external financing assistance and resolve it.

In such adverse scenarios, funding options like emergency business loans come as a viable funding option to keep your venture afloat. Financing such needs can also be done conveniently via gold loans that can suitably serve as a last-minute funding backup during emergencies.

Gold Loan – An Ideal Source of Business Finance during Emergencies

Gold loans from Rupeek Fintech Private Limited are available with instant approval and disbursal facility, which is ideal for curtailing emergency funding needs of a business. With one of the highest loan to value ratio on the gold pledged, Rupeek’s gold loan serves as a suitable funding option for businesses.

Plus, the first-in-market doorstep facility with loan disbursal within 30 minutes makes the entire gold loan availing process fast and hassle-free.

Gold loans, available as a secured funding option, are disbursed at lowest interest rates compared to conventional unsecured loans. It also allows borrowers to utilise an essentially idle asset to raise necessary financing.

Moreover, the following beneficial features of gold loans make them a worthy consideration for all your business liquidity needs.

  • Minimal documentation

Unlike other business financing options, a gold loan does not require lenders to go through an extensive documentation process. Instead, one can simply submit KYC documents like his/her identity and address proof to avail these hassle-free loans. This simple process further accelerates approval, allowing companies to start using the borrowed sum at the earliest.

  • Easy to meet eligibility criteria

Banks and NBFCs often have a long list of requirements that a potential borrower needs to meet before he/she can avail funding for business expenses. Thankfully, gold loans follow a much simpler approach in this regard as well. A gold loan borrower needs to meet only a simple requirement of possessing gold jewellery or ornament of certain purity.

Since most Indian households possess some gold jewellery, all of these requirements are extremely easy to meet and follow.

  • Attractive loan-to-value (LTV) and interest rates

Attractive LTV means a loan of high value. Loan-to-value ratio is the percentage of the pledged gold’s value that a lender is ready to extend as loan. Thus, a high LTV allows you to secure sufficient funds as an emergency business loan.

Plus, due to the added security for lenders, gold loans come at lower interest rates for borrowers when compared to unsecured business loan options. The decreased interest can be crucial as it limits the repayment burden. Therefore, owners can instead focus on successfully running the businesses and manage the finances efficiently.

  • Convenient repayment

You can also manage your gold loan conveniently with flexible repayment options. Here, you can choose to defer the principal payment until the tenure’s end and meanwhile pay only interest accruing on your borrowed amount at an affordable rate.

Borrowers also have an option to defer the entire payment up to the end of their tenure, and thereby make bullet repayment of principal plus interest at once.

  • Loans at your doorstep

Rupeek Fintech Private Limited offers the unique service of disbursing loans right at your home. Once the applicant has filled an online application for your gold loan, a loan manager reaches his/her house to assess, and evaluates the pledged asset. Once this assessment is complete, borrowers receive the principal amount in their bank accounts in just a matter of minutes. The loan manager only leaves with your pledged gold products after you confirm receipt of the funds.

If you are worried about storage of the valuable, do not be! Rupeek ensures utmost security and safety for your pledged ornaments during the loan tenure. The ornaments are placed inside secure vaults at Rupeek’s partner bank branch situated within a range of 3 km from your home. Also, the pledged jewellery is insured till the time you repay the loan.

All the benefits mentioned above like the facility of immediate financing, flexible repayment option, low rates of interest, etc. make gold loans the ultimate choice to fund emergency business expenses with ease. Apply now for a Rupeek Gold Loan.

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