Planning to take a business loan? It's important to understand the interest rates and other charges before you apply. Business loan interest rates usually range between 14% and 26% per year. There may also be a processing fee of up to 3.54% of the loan amount.
Other charges, like Flexi Facility fees, prepayment charges, and yearly maintenance fees, might also apply. Knowing these costs in advance will help you choose the right loan and manage your repayments better.
Applicable fees and charges
| Type of fee | Applicable charges |
| Rate of interest | 14 to 26% per annum |
| Processing fees | Up to 3.54% of the loan amount (inclusive of applicable taxes) |
| Bounce charges | Rs. 1,500 per bounce. “Bounce charges” shall mean charges for (i) dishonour of any payment instrument; or (ii) non-payment of instalment (s) on their respective due dates due to dishonour of payment mandate or non-registration of the payment mandate or any other reason. |
| Flexi Facility Charge | Term Loan - Not applicable Flexi Term Loan (Flexi Dropline) - Up to Rs. 999/- (inclusive of applicable taxes) Flexi Hybrid Loan (as applicable below) - • Up to Rs. 6,499/- (inclusive of applicable taxes) for loan amount less than Rs. 1000000/-. • Up to Rs. 8,999/- (inclusive of applicable taxes) for loan amount from Rs. 1000000/- to Rs. 1499999/-. • Up to Rs. 13,999/- (inclusive of applicable taxes) for loan amount from Rs. 15,00,000/- to Rs. 24,99,999/- • Up to Rs. 16,999/- (inclusive of applicable taxes) for loan amount of Rs. 25,00,000/- and above. *The above Flexi facility charges will be deducted upfront from the loan amount *Loan amount includes approved loan amount, insurance , VAS Charges. |
| Penal charge | Delay in payment of instalment(s) shall attract Penal Charge of Rs. 40 per day per instalment from the respective due date until the date of receipt of the full instalment(s) amount. |
| Prepayment charges | Full Pre-payment Flexi Term Loan (Flexi Dropline): Up to 4.72% (inclusive of applicable taxes) of the total withdrawable amount as per the repayment schedule as on the date of full prepayment. Flexi Hybrid Loan: Up to 4.72% (inclusive of applicable taxes) of the total withdrawable amount as per the repayment schedule as on the date of full prepayment. Not applicable for Flexi Term Loan (Flexi Dropline) and Hybrid Flexi. |
| Stamp duty | Payable as per state laws and deducted upfront from loan amount |
| Broken period interest | Method of recovery of "Broken Period Interest/Pre monthly instalment Interest" would be as follows: Scenario 1: If Loan is disbursed on 1st or post 10th of the month: |
| Annual maintenance charges | Term Loan: Not applicable Flexi Term Loan (Flexi Dropline): Up to 0.413% (Inclusive of applicable taxes) of the total withdrawable amount (as per the repayment schedule) on the date of levy of such charges. Flexi Hybrid Loan: Up to 1.18% (Inclusive of applicable taxes) of the Total Withdrawable Amount during Initial loan tenure. Up to 0.413% (Inclusive of applicable taxes) of the Total Withdrawable Amount during Subsequent loan tenure. |
| Legal and incidental charges | Recovery of charges |
| Principal Holiday Facility Fees | Principal Holiday (as applicable below) - (Inclusive of applicable taxes) Up to Rs. 6499 (Inclusive of applicable taxes) for loan amount less than Rs. 10,00,000. Up to Rs. 8,999 (Inclusive of applicable taxes) for loan amount between Rs. 10,00,000 and 14,99,999. Up to Rs. 13,999 (Inclusive of applicable taxes) for loan amount between Rs. 15,00,000 and Rs. 24,99,999. Up to Rs. 16,999 (Inclusive of applicable taxes) for loan amount Rs. 25,00,000 and above. Note- The above principal holiday facility fees will be deducted upfront from loan amount. Loan amount includes approved loan amount, Insurance Premium and VAS Charges. |
What is a Business Loan Interest rate?
The interest rate on a business loan represents the percentage of the loan amount that the lender imposes as a fee for providing funds to a borrower. Typically presented as an annual percentage rate (APR), this rate fluctuates based on factors such as the loan type, amount, duration, and intended use.
How to calculate business loan interest rate?
Before applying for a Business Loan, it’s important to understand how the interest rate is calculated. Several key factors influence your borrowing cost. Here's a simple guide to help you estimate your interest rate:
- Loan amount: The interest rate may vary depending on how much you borrow. Higher loan amounts may sometimes attract better interest rates.
- Loan tenure: The repayment period affects the rate. Shorter loan terms often come with lower interest rates, while longer tenures may carry slightly higher rates due to increased risk for the lender.
- Credit score: A credit score of 685 or higher is usually preferred. A higher score shows good repayment history and may help you get a more competitive rate.
- Business income and financials: Lenders assess your business turnover, profit, and existing liabilities before offering a rate. A strong financial profile can help you negotiate lower rates.
- Type of business loan: Bajaj Finserv offers options like Term Loan, Flexi Term Loan, and Flexi Hybrid Loan. Each variant has a different interest structure which can affect the total cost of borrowing.
To plan better, use the Business Loan EMI Calculator . By entering the loan amount, interest rate, and tenure, you can get a quick estimate of your monthly EMI. This helps in budgeting and making a well-informed borrowing decision
Factors that affect Business Loan Interest rates
When applying for a Business Loan, it’s important to understand the factors that influence the interest rate. Being aware of these can help you plan your loan better and manage your overall borrowing cost. Here are the key things lenders usually consider:
- Credit score: A credit score of 685 or above is ideal. A strong score shows that you’re a reliable borrower and can help you secure a lower interest rate.
- Business stability: If your business has been running steadily for a few years and shows stable income, lenders are more likely to offer you a competitive interest rate.
- Income level: A steady and higher business income reflects strong repayment ability. This gives lenders more confidence and may result in better loan terms.
- Loan amount: Sometimes, a larger loan amount can qualify you for a slightly lower rate, depending on your profile and the lender’s policy.
- Loan tenure: Shorter repayment periods often attract lower interest rates compared to longer ones, as there is less risk involved for the lender.
- Market conditions: Economic trends and changes in the financial market can also affect business loan interest rates. Rates may go up or down depending on inflation, RBI policies, or other external factors.
Understanding these factors helps you make smarter financial decisions and improve your chances of getting a business loan on favourable terms.
Tips to availing Business Loans at the lowest Interest rates
Getting a business loan at a low interest rate requires smart planning and the right financial approach. Here are some key steps that can help you secure the most competitive rates:
- Keep a strong credit score: Aim for a credit score above 685. A high score shows that you manage credit responsibly. Make sure to pay EMIs and credit card bills on time to maintain a good credit history.
- Choose shorter loan tenures: If your business cash flow allows it, go for a shorter repayment period. This often reduces the lender’s risk and can help you get a lower interest rate.
- Show stable business income: Lenders look for consistency. Submit proof of regular and healthy income from your business to show that you can repay the loan comfortably.
- Compare lenders before applying: Don’t settle for the first offer. Check interest rates, processing fees, and other charges from different lenders to find the best deal for your business needs.
- Pick the right loan type: Bajaj Finserv offers options like Term Loan, Flexi Term Loan, and Flexi Hybrid Loan. Choose the one that matches your business cash flow and repayment preferences to avoid unnecessary costs.
- Apply with a co-applicant if needed: Adding a financially strong co-applicant can improve your loan eligibility and may help you secure a better interest rate.
By following these steps, you can reduce your total interest cost and make your business loan more affordable in the long run. Apply for a business loan now and settle all your financial wants and needs.
How to apply for a business loan
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Frequently asked questions
The processing fee for a Bajaj Finserv Business Loan may go up to 3.54% (inclusive of applicable taxes).
Up to 4.72% (inclusive of applicable taxes) on the part-prepayment amount will be charged in case of a term loan. However, there are no part-prepayment charges if you opt for the Flexi Term Loan or Flexi Hybrid Loan.
Bounce charge is the fee incurred in case of a missed EMI payment. Bajaj Finserv charges Rs. 1,500 per bounce, for every EMI missed.
You can get a Bajaj Finserv Business Loan at a competitive interest rate between 14% to 26%% p.a.
The foreclosure charge that you pay depends on the loan variant you choose. It is:
- Term Loan: Up to 4.72% (inclusive of applicable taxes) on the outstanding loan amount as on the date of full prepayment.
- Flexi Term Loan (Flexi Dropline): Up to 4.72% (inclusive of applicable taxes) of the total withdrawable amount as per the repayment schedule as on the date of full prepayment.
- Flexi Hybrid Loan: Up to 4.72% (inclusive of applicable taxes) of the total withdrawable amount as per the repayment schedule as on the date of full prepayment.
You can get a repayment tenure ranging from 1 year to 8 years.
No, you do not need any collateral to get a Bajaj Finserv Business Loan.
You need a minimum credit score of 685 in order to get a business loan from us.
Use our free business loan EMI calculator to figure out how much interest you will have to pay on your loan. To see the interest charged, simply move the sliders to your preferred loan amount and tenure.
Your interest rate depends on how well you meet the eligibility criteria for the loan. Typically, it reflects the following factors:
- Your CIBIL Score
- Your business’s financials
- How long your business has been active
Ensure that you meet all the eligibility criteria in order to get the best deal on your business loan. The more profitable and longer-running your business, the lower your rate of interest. You must also ensure that your business has a minimum CIBIL Score of 685. The higher your CIBIL Score, the better your chances of securing a low-interest business loan.
With Bajaj Finserv Business Loan you can get a loan of up to Rs. 80 lakh. Your loan amount will depend on various factors like age, business turnover, Credit Score and more.
Choosing between a business and personal loan depends on your situation. Business loans are ideal for funding business-related expenses, while personal loans provide flexibility but may not offer the same tailored features for business needs.
