A Business Loan eligibility calculator helps business owners assess their eligibility for a Business Loan and understand the financial parameters involved. The calculator considers several factors to determine whether a business is eligible for a Business Loan and, if so, how much it can borrow. Here are the key factors that a Business Loan eligibility calculator considers:

City

The location of the business plays a role in determining your Business Loan eligibility, as lenders may have different criteria based on geographical risk factors and local economic conditions. Some cities may have higher eligibility limits or better interest rates due to their financial activity and business environment.

Age of the business

Age is another factor that Business Loan eligibility calculators consider. Individuals applying for a Business Loan should be at least 22 years of age at the time of application. You also need to calculate your age at the time of maturity. The applicant should not be over 65 years of age at the time of Business Loan maturity.

Net profit after tax

Net profit after tax is the amount remaining after taxes have been deducted from your business's net profit. A positive and growing profit indicates strong profitability, which reassures lenders that your company has the financial capability to repay the Loan. Business Loan calculators use this metric to assess your business's ability to generate profits and meet repayment obligations.

Annual income

Annual income is the revenue your business generates each year. It is an important indicator of cash flow, which determines how much your business can afford to pay toward Loan repayment. Annual income is a key factor that you must input into the Business Loan calculator in India, and businesses need to earn at least Rs. 2 lakh per year.

Interest rates

The interest rate determines how much extra you will pay over the Loan tenure based on the principal amount. It is typically influenced by factors such as your credit score, the Loan amount, tenure, and business risk. A higher interest rate increases the expense of the Business Loan. The calculator calculates the interest rate to estimate the Equated Monthly Instalments and the total repayment amount.

Loan tenure

Loan tenure is the period during which the Loan will be repaid. The tenure can range from 12 to 48 months, depending on the Loan amount, lender policies, and the business's repayment ability. A longer tenure results in smaller EMIs, but you may pay more interest over the long term. The Loan tenure helps the Business Loan calculator to estimate the monthly and total repayment amounts.

Conclusion

Business Loan eligibility calculators influence how affordable the Loan is for your business. It helps you find the right balance between monthly payments and long-term costs. Once you enter accurate data into the calculator, you get a clearer picture of your eligibility and the best Loan terms for your business.