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By Admin 10 Oct,2023
It is now 15 year of mine experience in loan syndication and in this journey of mine have helped more than 10000 SMEs till date and have seen many companies evolving and able to make great success stories in their business and also witnessed few downfalls of business and getting their operation closed but was it only loan which killed the business?
If a loan would have to kill the business, then most of the business would not be in existence. There are many new and established businesses that are making most of their business with the additional support of the loan. There are many success stories about business achieving milestones with the help of loans from a bank in their business. The most famous one is Shri Dhirubhai Ambani who established a huge business empire with the help of an initial 1.5 million loan from the bank to start his factory and procure raw material and machinery for his factory. Now reliance industries are a renowned name of trust and success to everyone. No business can deny this fact that loan does not help grow or achieve the milestone on businesses. Borrowers only need to be more vigilant and take all the borrowing decisions very carefully after analyzing all benefits and risks involved in taking any loan.
When an entrepreneur starts their new business, the only goal in mind is to achieve new heights and to earn a reputation among their competitors in their businesses. One puts all of their hard work, time, and money to rise step by step in their business, and healthy cash flow in business plays the most vital role in helping the business to run their operations smoothly. Cashflow has always been in the business system either through own sources, private lenders, friends, and family or any organized lender such as banks or NBFC.
A well-funded business can easily execute their business plan properly and expand accordingly. During expansion or any low time in business, the business owner might feel the need for a loan which can help bridge the working gap which helps running daily operations smoothly or explore new opportunity to earn more profits in business.
But one should know certain limitations at the time of availing any kind of loan as loan is the amount you have to pay back with interest to the lender, so borrowing should be done with the proper plan after knowing well your lender. ideally, there are two types of lenders.
Private lender-These is an unorganized lender who charges a very high rate of interest and exploits the borrower.
Banks or NBFC – These are organized lenders, governed by the reserved bank of India offer a comparatively lower rate of interest and have the gamut of the product as per your need and your type of business.
Here Banks/NBFC helps businesses to maintain healthy cash flow and explore a new opportunity in business.
I can assure that business who are killed or have failed, it cannot be only because of the loan. There will be multiple reasons behind this misfortune such as not understanding their business model properly, not having adequate profit in business, dependency on others while making any decision, taking a loan without estimating the current financial condition of the business. borrowing too much of loan without understanding the end-use of loan or not using loan borrowed with proper financial planning in business and most importantly not understanding the right type of loan according to business needs.
Currently, there are more than 50+ Banks/NBFC who are there to loan businesses as per there requirements but the borrower should analyze the loan requirement with their partner, family member, CFO of the company or any reliable advisor such as rupyaapaisa.com who can help them in having the deep insight of requirements of the loan, purpose of requirements, type of loan as per requirement, the quantum of loan, tenure of the loan, best ROI among all the options available and foremost what EMI can be comfortably paid even at the time of uncertain situations in business.
If you don’t do this exercise before applying for a loan you might end up landing into a mess and will start blaming the decision of taking a loan at the time of downtrend in business.
It can be taken as if you are driving your car, you have to be alert and vigilant while driving or any of your negligence will lead you to an accident similarity when you have availed any facility from Banks/NBFC you have to be very particular about your borrowing and end-use of the fund along with timely repayment of the loan.
Before finalizing any loan requirement, one should necessarily see both aspects of the coin i.e. advantages and disadvantages of loan. every decision in business has a certain amount of risk which all business owners should be aware of which helps to take necessary measures to lower the chances of loss.
It is well said that precaution is better than cure, this means if the loan is availed with precaution you will be able to reach high rise in your business by tapping the new market, bridging your working capital gap in business, expand to a new location to make a global presence and always have an edge among your competitors but if you don’t have defined end-use of the loan then you will end up paying heavy interest on the loan and lose all your profit in business. you might hamper your creditworthiness and CIBIL score and might have chances of losing your assets too.
So, in nutshell, you have to be honest and vigilant while doing any business transaction and this will ensure great success in business along with all your business partners, employee, family, and even your bank who will be supporting you in achieving your growth.
For any detail, discussion feel free to connect @ 9811762199
It is now 15 year of mine experience in loan syndication and in this journey of mine have helped more than 10000 SMEs till date and have seen many companies evolving and able to make great success stories in their business and also witnessed few downfalls of business and getting their operation closed but was it only loan which killed the business?
If a loan would have to kill the business, then most of the business would not be in existence. There are many new and established businesses that are making most of their business with the additional support of the loan. There are many success stories about business achieving milestones with the help of loans from a bank in their business. The most famous one is Shri Dhirubhai Ambani who established a huge business empire with the help of an initial 1.5 million loan from the bank to start his factory and procure raw material and machinery for his factory. Now reliance industries are a renowned name of trust and success to everyone. No business can deny this fact that loan does not help grow or achieve the milestone on businesses. Borrowers only need to be more vigilant and take all the borrowing decisions very carefully after analyzing all benefits and risks involved in taking any loan.
When an entrepreneur starts their new business, the only goal in mind is to achieve new heights and to earn a reputation among their competitors in their businesses. One puts all of their hard work, time, and money to rise step by step in their business, and healthy cash flow in business plays the most vital role in helping the business to run their operations smoothly. Cashflow has always been in the business system either through own sources, private lenders, friends, and family or any organized lender such as banks or NBFC.
A well-funded business can easily execute their business plan properly and expand accordingly. During expansion or any low time in business, the business owner might feel the need for a loan which can help bridge the working gap which helps running daily operations smoothly or explore new opportunity to earn more profits in business.
But one should know certain limitations at the time of availing any kind of loan as loan is the amount you have to pay back with interest to the lender, so borrowing should be done with the proper plan after knowing well your lender. ideally, there are two types of lenders.
Private lender-These is an unorganized lender who charges a very high rate of interest and exploits the borrower.
Banks or NBFC – These are organized lenders, governed by the reserved bank of India offer a comparatively lower rate of interest and have the gamut of the product as per your need and your type of business.
Here Banks/NBFC helps businesses to maintain healthy cash flow and explore a new opportunity in business.
I can assure that business who are killed or have failed, it cannot be only because of the loan. There will be multiple reasons behind this misfortune such as not understanding their business model properly, not having adequate profit in business, dependency on others while making any decision, taking a loan without estimating the current financial condition of the business. borrowing too much of loan without understanding the end-use of loan or not using loan borrowed with proper financial planning in business and most importantly not understanding the right type of loan according to business needs.
Currently, there are more than 50+ Banks/NBFC who are there to loan businesses as per there requirements but the borrower should analyze the loan requirement with their partner, family member, CFO of the company or any reliable advisor such as rupyaapaisa.com who can help them in having the deep insight of requirements of the loan, purpose of requirements, type of loan as per requirement, the quantum of loan, tenure of the loan, best ROI among all the options available and foremost what EMI can be comfortably paid even at the time of uncertain situations in business.
If you don’t do this exercise before applying for a loan you might end up landing into a mess and will start blaming the decision of taking a loan at the time of downtrend in business.
It can be taken as if you are driving your car, you have to be alert and vigilant while driving or any of your negligence will lead you to an accident similarity when you have availed any facility from Banks/NBFC you have to be very particular about your borrowing and end-use of the fund along with timely repayment of the loan.
Before finalizing any loan requirement, one should necessarily see both aspects of the coin i.e. advantages and disadvantages of loan. every decision in business has a certain amount of risk which all business owners should be aware of which helps to take necessary measures to lower the chances of loss.
It is well said that precaution is better than cure, this means if the loan is availed with precaution you will be able to reach high rise in your business by tapping the new market, bridging your working capital gap in business, expand to a new location to make a global presence and always have an edge among your competitors but if you don’t have defined end-use of the loan then you will end up paying heavy interest on the loan and lose all your profit in business. you might hamper your creditworthiness and CIBIL score and might have chances of losing your assets too.
So, in nutshell, you have to be honest and vigilant while doing any business transaction and this will ensure great success in business along with all your business partners, employee, family, and even your bank who will be supporting you in achieving your growth.
For any detail, discussion feel free to connect @ 9811762199
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