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HDFC Bank Business Loan

HDFC Bank Business Loan

HDFC Bank promotes business loans to develop your own business anywhere in India, be it large-scale ventures or small-scale firms. These schemes are made for people requiring funds to operate the business. Also, these are free of collateral. Its low interest rates and policy clarity make them one of the best business loan schemes in India.

What are the Features and Benefits of HDFC Bank Business Loans?
Here’s what makes HDFC Bank Business Loan different from other business loans:

· Collateral-free: HDFC Bank Business Loans do not involve any collateral or security, thus bringing you peace of mind.

· Transfer Business Loan Balance: This lets you transfer existing debts into a single consolidated Business Loan which is paid back at an easy monthly

· Competitive Interest Rates: Low interest rates, starting at 15.75% p.a.

· Low Processing Fees: The processing fee starts at 0.99%.

· Up to 40 Lakhs Loan Amount: Get a loan of up to 40 Lakhs and 50 Lakhs in selected locations without any collateral security.

· Dropline Overdraft Facility: Pay back your interest only on the utilized amount.

· Quick Eligibility Check and Loan Disbursal: Your loan eligibility is checked in less than 60 seconds, and loan disbursal procedures are quick.

· Flexible Repayment Tenures: Pay back your loan within a flexible tenure of 12 to 48 months.

· Many Branches: you can apply for a Business Loan directly from 4,972 branches of HDFC Bank in India.

· Credit Protect Option: HDFC doesn’t just give you a Business Loan, but also provides credit insurance. The Credit Protect Scheme deducts the insurance charges from your loan amount and provides loan repayment protection cover. This credit protection comes with tax benefits.

What is the Interest Rates for HDFC Bank Business Loan?

HDFC Bank offers Business Loans at fixed interest rates of 15.50% to 18.30%, based on the eligibility of the borrower. However, the following are the factors that affect the interest rate for business loans:

· Credit score of the company or in the case of a new business the owner.

· Type of business: Proprietorship, Partnership, Private Limited or Public Limited

· Turnover of the business

· Profit made by the business

· Cash flow of the business

· Track record of business 

What are the Eligibility criteria HDFC Bank Business Loan?

For the HDFC Bank Business Loan, the applicant should meet the following eligibility criteria:

  • Any proprietor, self-employed individual, partnership firm, or private limited company involved in trading, manufacturing, or services can apply.
  • The applicant must be 21 years old at the time of borrowing and a maximum of 65 years old at the time of maturity of the loan.
  • Minimum business turnover must be 40 Lakhs.
  • Applicant must be associated with the current business for the past 3 years.
  • The total business experience of the individual must be a minimum of 5 years.
  • The business should be in a profitable state for the last two years.
  • Lastly, the annual income (ITR) of the business must be a minimum of 1.5 Lakhs.
What are the Documents Required for HDFC Bank Business Loans?

The following documents are required along with your Business Loan application:

· PAN Card – For Company/Firm/Individual

· A copy of any of the following documents as identity proof:

· Aadhaar Card

· Passport

· Voter’s ID Card

· PAN Card

· Driving License

· A copy of any of the following documents as address proof:

· Aadhaar Card

· Passport

· Voter’s ID Card

· Driving License

· Bank statement of the previous 6 months

· Latest ITR along with computation of income, Balance Sheet, and Profit and loss account for the previous 2 years.

· Proof of continuation ITR/Trade license/Establishment/Sales Tax Certificate

· Other Mandatory Documents, Sole Prop. Declaration or Certified Copy of Partnership Deed, Certified true copy of Memorandum & Articles of Association 

About Finline!

Finline is an online platform for creating financial reports for getting bank loans and investments. It’s like ‘Canva’ but for financials. If you are an entrepreneur looking for a bank loan, you need to have a well-crafted project report. We, at Finline will help you with that. Our team will help you create a powerful business plan in ten minutes. That too in your language. Also, all public and private sector banks working in India accept our project report. Click to create your report.

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Which Business Expenses to be Tracked?

If you are just commencing your business or if you are looking to expand soon, you need to track your business expenses. Tracking business expenses will help you minimize your taxable income, but it will also help you control your business.

  • Business expenses cover both the cost of goods sold, as well as the normal and necessary operational expenses associated with running the business.
  • There are costs associated which include rent, salaries, business licenses, permits, and self-employment.
  • Separating your business finances from your finances helps you more effectively track your business expenses.
Categories of Business Expenses:

It helps to analyze your business expenses. This can tell how you prioritize them in budgeting, and it’s easier to spot areas where you can easily costs if you need to.

  • Fixed: Fixed expenses are things that do not vary from month to month. These are items like mortgages, depreciation, insurance, salaries, and rent. While many of these expenses can change over time, they are usually fixed for the duration of a lease, agreement, or contract.
  • Variable: Variable expenses are the opposite of fixed expenses. They are necessary spending, but their total cost will vary with each billing cycle. Utilities often fall into this category. Inventory, commissions, and credit card fees are common examples of variable expenses.
  • Period: Period expenses can be fixed or variable, and they come at regular intervals. Examples of fixed period costs would be the mortgage, while variable period expenses would include utilities and insurance.
  • Interest: Interest can be fixed or variable. Many interest costs are bound to period expenses, but something like credit card purchases for travelling employees can be per transaction.
  • Depreciation. Depreciation is typically a fixed variable expense. It is necessary to help calculate the ROI on replacing major items. It is also typically a tax-deductible expense.
What are are few common Business Expenses?
  • Advertising
  • Bank fees
  • Commissions
  • Consulting fees
  • Contract labor
  • Dues and subscriptions
  • Mileage
  • Office Supplies
  • Postage and delivery
  • Printing and copying
  • Salaries
  • Software
  • Travel
  • Utilities
Some of the most common business expenses include tax-deductible:
  • Payroll expenses
  • Employee benefits
  • Home office expenses
  • Insurance premiums
  • Rent or mortgage payments
  • Retirement plans
  • Depreciation of equipment
  • Interest expense
  • Taxes
  • Donation
  • Digital Transactions
  • Business Utilities
Types of expenses that are not tax-deductible:
  • Political contributions
  • Government fines or penalties
  • Demolition losses or expenses
  • Certain education expenses
  • Legal fees
  • Capital expenses
About Finline!

Finline is an online platform for creating financial reports for getting bank loans and investments. It’s like ‘Canva’ but for financials. If you are an entrepreneur looking for a bank loan, you need to have a well-crafted project report. We, at Finline will help you with that. Our team will help you create a powerful business plan in ten minutes. That too in your language. All public and private sector banks working in India accept our project report. Click to create your report.

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What is Overdraft Account?

You incur debt when you use your overdraft (also known as “going into your overdraft”). People should only use overdraft accounts for short-term borrowing or emergencies. It’s critical to manage an overdraft account like any other debt and keep the costs in check. This guide explains how overdrafts work, how to avoid going over your limit, and how to avoid bank fees.

How does an overdraft work?

An overdraft allows you to borrow money from your current account by withdrawing more money than you have in the account—in other words, you go “overdrawn.” This is usually charged for.

You can request an overdraft from your bank, or they may give you one, but remember that an overdraft is a type of loan. If you need to borrow money, there may be less expensive ways. Therefore, it’s critical to always look for the cheapest way to borrow.

Overdraft Varieties

Authorized overdrafts: These are pre-arranged overdrafts. You and your bank agree on a limit and can spend up to that limit.

Unauthorized overdrafts: These are also known as “unplanned” or “unarranged” overdrafts and occur when you spend more than you have in your bank account without first agreeing to it. It includes exceeding the limit of an authorized overdraft.

Do you require an overdraft?

Do you frequently use your overdraft? If you find yourself frequently using your overdraft, you should use our Finline Budget Planner to gain control of your finances.

Overdrafts can be beneficial to some people. They can assist you in avoiding fees for late or returned payments. These occur when you attempt to make a payment, but your account needs more funds.

In an emergency or as a short-term solution, one should use overdrafts.

According to the Financial Conduct Authority (FCA), many underestimate how much they use their overdrafts. If you use your overdraft more than you think, you may be paying more than you realize.

Overdraft Management Suggestions
  • Keep track of your account balance.

One of the best ways to avoid overdraft fees is to keep track of your account balance.

  • Make things as simple as possible by:

If you have a smartphone, download your bank’s app and set up text alerts for when your balance is low using phone banking.

  • Continue to read the letters from your bank.

It’s easy to fall into the habit of not opening bank letters and assuming they’re just routine correspondence. Instead, check all letters because the bank may be writing to inform you of a change in your overdraft limit or an increase in your overdraft interest rate.

  • If you have any savings, use them.

If you have savings and an overdraft, it will be cheaper, in the long run, to pay it off with your savings. However, if an unexpected expense arises, you can still use your overdraft to cover it. And if you don’t, you can start saving again to be prepared for an unexpected expense.

  • Discover ways to live on a budget.

Reducing spending will help you free up money to reduce your overdraft as quickly as possible. Then, you can use the money you save to pay off your overdraft.

About Finline!

Finline is an online platform for creating financial reports for getting bank loans and investments. It’s like ‘Canva’ but for financials. If you are an entrepreneur looking for a bank loan, you need to have a well-crafted project report. We, at Finline help you with that. Our team will help you create a powerful business plan in ten minutes. That too in your language. All public and private sector banks working in India accept our reports. Click to create your report.

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How to Track Business Expenses?

The first step to doing so is separating your business expenses from your personal expenses. This will help you understand how much you’re spending as a small business owner. Thus managing your expenses will increase profitability.

Many small business owners track their business expenses using Microsoft Excel. However, this method increases the chance of human error as your business grows, can be difficult to keep organized.  

What are business expenses?

Business expenses are those expenditures that relate directly to starting and maintaining your business. They include expenses like inventory purchases, wages, and salaries, etc. 

There are two types of business expenses: cost of goods sold, which are costs associated with making your product; and operating expenses, which include rent, salaries, business licenses, and permits, and self-employment.

Businesses need to track and classify their expenditures because some expenses can count as tax reductions, resulting in important cost savings. This means you’ll pay less at tax. It will demonstrate to lenders that your business is fiscally responsible and can be a trusted borrower when you need financing. 

Follow the points to track business expeses: 
1. Open a business bank account

As a new business owner, you will need to open a business bank account. There may be an instance when you use your bank account for business purposes, having a separate business account will make it much easier to track and record your expenses properly.

You’ll need to open:

· A business chequing account

· A business savings account

· A business credit card

 2. Choose an appropriate accounting system

You have a choice about what kind of accounting system to use for your business. While the best option is to choose an accounting software application that will work for your business, you can also use spreadsheet software, such as Microsoft Excel to record income and expenses for your business.

3. Managing Receipts Properly

Here are some strategies to keep paper receipts organized:

· Keep a separate envelope in your purse or bag for business paper receipts. 

· Use file folders. At the beginning of the year, make one for each month and file your receipts accordingly. 

· Use binders. Buy plastic sleeves and label them by month or category. 

You can store receipts digitaly, many apps are available to make it easier to store receipts digitally. 

4. Make a Spreadsheet

If you’re just starting a business this option works if you prefer a low-tech approach to track your expenses. As your business grows you’ll want to use a more sophisticated tracking method. 

Spreadsheets are also easy to import into your accounting software to batch add expenses. Make a spreadsheet in Excel or Google with the following columns:

  • Date
  • Category
  • Vendor
  • Cost
  • Purpose 

 Consider using the following categories:

  • Marketing
  • Client meals
  • Home office or office rent/mortgage and utilities
  • Travel expenses
  • Office supplies
5. Select an accounting method

The cash-basis method is the simplest accounting method for small business owners. With the cash method, you record income when you receive it and expenses when you make payment.

The accrual basis is more complex than the cash-basis method and uses additional accounting categories. In accrual accounting, you record income and expenses when you incur them, regardless of when you receive money or pay.

Consider the size of your business when selecting your accounting method.

6. Use software to track and analyze business purchases.

Most accounting software programs create expense categories. It will help reduce the time you spend preparing your tax returns.Many budget tracking tools can also help you calculate monthly expenses, track personal capital, and even sync with your credit or debit card. 

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How to Set Business Management Standards?

There are endless reasons that contribute to the low success rates of new startups. One of them is neglecting to set up proper business management standards.

Executing business standards inspires confidence in your business. It can also help retain existing customs and open doors to new markets apart from the competition.

What are business management standards?

Management standards are a crucial element of running a business. Moreover, it defines the level of trust and credibility amongst different stakeholders. Performance, quality standards, safety, competition, employees, etc cover a wide area. 

Steps to set up business management standards:
1. Define your company values

Firstly, start by defining your company mission, vision, and objectives. The questions you need to answer include:

  • The reason for your existence
  • What kind of behaviour do you want within the organization
  • Understanding of rules and regulations
  • A clear path to success, including timelines and techniques
  • Priority areas for the short-term and long-term
2. Create clear management standards

Secondly, create clear management standards. It becomes easier to see the performance when you have set standards in a managerial position. Moreover, consistency and quality are only possible with accountability.

The lower-level staff hide behind authority and feel they are not accountable to anyone. Every manager should have the same set of rules apply to them.

3. Keep the lines of communication open

Achieving business growth means you must learn to communicate effectively. As the owner of the business, it helps to lead by encouraging interaction and open feedback. Junior employees do not interact with management. Moreover, as per the hierarchical system, those at the top see themselves as separate from those at lower levels. 

They could be the source of fantastic ideas that can grow the business. They communicate more with customers than you do. As a result, it is the best source of information on what other people are saying

4. Know your customers and competition 

Know what your competitor is offering in terms of current as well as new customers, and expect to set your foundation accordingly. Understand what the competition is delivering what areas you want to match and other areas you want to exceed.

5. Pay attention to team dynamics

Take the time to understand each team member. Encourage open communication without fear of negative repercussions. The work environment may bring different people together. It is not possible to avoid conflict altogether. 

6. Delegate and balance your priorities

As a startup, focus on what needs your attention. Hiring the right people and spending the time looking at long-term goals for the business. 

It only makes sense that you want to know how everything is running on a priority. 

7. Train your team 

Once you define the standards for your product or service train your team accordingly. Allow and empower them to make things right when a mistake is made. If it is something that needs to be escalated, be sure your team knows the process and can explain the resolution steps to your customer along with a timeline.

8. Meet with your teams constantly

It is an excellent way to establish accountability. It is a good idea to hold status meetings on a weekly or bi-weekly basis. Team members working in key roles should give progress reports. It gives everyone within the team a chance to be noticeable. However, it gives you a chance to know that processes are running well.

9. Establish a system of measurement standards

For any standard to be upheld – it needs to be measured. Know what the standard is and set the goal to be above that. It is necessary to have a benchmark to estimate performance and success against. Measurement standards must be specific to each process. It may include things such as:

  • Technical specifications
  • Quality assurance
  • Product inspection
  • Financial audits
  • Management audits
  • Staff audits
  • Customer service
  • Human resource
  • Staff and customer feedback, and so much more.

Each organization is different in its processes. Coming up with your own goals and values is a critical part of growth.

About Finline!

Finline is an online platform for creating financial reports for getting bank loans and investments. It’s like ‘Canva’ but for financials. If you are an entrepreneur looking for a bank loan, you need to have a well-crafted project report. We, at Finline will help you with that. Our team will help you create a powerful business plan in ten minutes. That too in your language. Also, all public and private sector banks working in India accept our project report. Click to create your report.

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Priority to MSMEs in Post-COVID

According to the Annual Report of the Department of MSME published in September 2019, there are 6.34 crore MSMEs in India.

The COVID pandemic has left an enduring impact on the economy. Global supply chains are affected, imports and exports are hindered, and unemployment is rising. Across the world and in India, Micro, Small, and Medium Enterprises (MSME) have been affected very badly. 

Thousands of stranded and jobless migrant workers across the country are proof of how MSMEs have seen the worst victims of the COVID-19 pandemic. Even though the government have taken several measures to protect and give priority to MSMEs during this difficult time.

MSMEs: Backbone of the Indian economy

Micro, Small, and Medium Enterprises (MSMEs) play a major role in India’s economy. This sector adds to a huge 30 per cent of India’s GDP and employs an estimated 28 per cent of the labour force. They support the livelihoods of over 100 million people. Estimations imply that the sector generated around 13.5 million to 14.9 million new jobs per annum between 2015 and 2019 standing as the backbone for India.

The Government of India needs to give priority to MSMEs in post-COVID survival and recovery. However, this needs a collective effort from the government and the businesses to survive and revive post-crisis. The government has taken various actions to give priority to MSMEs in the post-COVID era. The action includes:

i) Bailout packages

The government is already thinking of a bailout package for the sector. With reports indicating that a proposal to guarantee Rs 3 trillion of loans to small businesses. Union Ministery MSMEs has also indicated that a corpus of Rs 10,000 crore is on the way to buy up to 15 per cent equity in MSMEs with a high credit rating.

MSMEs also need more widespread and intelligent measures to be able to help smaller companies. 

ii) Make easy loans available

To ensure the survival of medium and small-scale enterprises over the next few months, it is imperative to provide the much-needed liquidity to keep their basic operations running. Therefore, it is time to make easy and low-interest loans available to the MSME sector immediately. The loan amount available for each organization must be equivalent to at least two to three months of operational costs.

Various steps were taken for the Revival and Prioritising Indian MSMEs due to the COVID-19 Pandemic :

The Ministry of MSME implements various schemes and programs for the growth and development of the MSME Sector in the country, including, the Prime Minister’s Employment Generation Program (PMEGP), Scheme Fund for Regeneration of Traditional Industries (SFURTI), A Scheme for Promoting Innovation, Rural Industry and Entrepreneurship (ASPIRE), Interest Subvention Scheme for Incremental Credit to MSMEs, Credit Guarantee Scheme for Micro and Small Enterprises, Micro and Small Enterprises Cluster Development Programme (MSE-CDP), Credit Linked Capital Subsidy and Technology Upgradation Scheme (CLCS-TUS).

Recently, the Government has taken several initiatives under Aatma Nirbhar Bharat Abhiyan to prioritize the MSME Sector in the country, especially during the COVID-19 pandemic. Some of them are:

i) Rs 20,000 crore Subordinate Debt for MSMEs.

ii) Rs. 3 lakh crores Collateral Automatic Loans for business, including MSMEs.

iii) Rs. 50,000 crore equity infusion through MSME Fund of Funds.

iv) Newly revised criteria for the classification of MSMEs.

v) New Registration of MSMEs through ' Udyam Registration' for Ease of Doing Business.

vi) No global tenders for procurement up to Rs. 200 crores, this will help MSME.

An online Portal “Champions” was launched on 01.06.2020 by the Prime Minister. This covers many aspects of e-governance including grievance redressal and handholding of MSMEs. Through the portal, a total of 18,723 grievances have been redressed up to 09.09.2020. RBI has also announced several measures to Reduce the Financial Stress of MSMEs.

About Finline!

Finline is an online platform for creating financial reports for getting bank loans and investments. It’s like ‘Canva’ but for financials. If you are an entrepreneur looking for a bank loan, you must have a well-crafted project report. We, at Finline will help you with that. Our team will help you create a powerful business plan in ten minutes. That too in your language. Also, all public and private sector banks working in India accept our project report. Click to create your report.

 

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What Is an Expense Report?

One uses an Expense Report form to record business expenses. The employees report various business expenses incurred by them out of their pockets. It includes any purchases that are necessary to run a business, such as parking, meals, gas, hotels, etc.

So basically, an expense report is a form through which the employees request reimbursement along with attached receipts for the expenses incurred.

Furthermore, the business entity examines the reports submitted and may reimburse the amounts.

A new small business may not have many expenses to track. But as you grow, your expenses will multiply. You’ll need to track how much you’re spending via an expense report form.

What should an expense report include?

An expense report should include all of the following information:

  • Department, position, contact info, SSN, etc of the identifying person submitting the report.
  • Date and amount for each expense, 
  • A brief description of each expense
  • Which account in your company’s the expense be billed to
  • Vendor: place of purchase
  • Client: what client was the item purchased for
  • Subtotals for each expense type, 
  • The employee submitting the report requesting the total reimbursement figure.
Why Do We Need Expense Reports? (And) Why They’re Important for Small Businesses?

The reasons why Expense Reports are needed include:

1. Tracking Expenses Over a Reporting Period

Expense Reports help you to realize how much you are spending. Thus, you can see if any particular expense category is leading to increasing your costs.

2. Reimbursing Employees

As mentioned, the employees incur expenses out of their pocket and ask for a reimbursement.

Thus, you need a proper system in place to ensure that the claims being demanded are authorized business expenses. They count the expenses which gives you an understanding of when, where, and how these expenses were incurred.

3. To file Tax Effectively

Many expenses incurred by your employees while at work are tax-deductible. However, till the time you have proof of the expenses, you cannot claim tax deductions.

With the help of expense reports, you can keep track of these tax deductibles. Your expense report must use the IRS’s expense categories to fast-track your taxes.

Thus, as a sole proprietor while preparing expense reports, make sure that you use the expense categories as specified in Schedule C.

The following are some expense categories that form part of Schedule C.

  • Advertising
  • Car and truck expenses
  • Commissions and fees
  • Contract labor
  • Employee benefit programs
  • Insurance
  • Interest
  • Mortgage
  • Legal and professional services
  • Office expenses
  • Pensions and profit-sharing plans
  • Rent or lease
  • Repairs and maintenance
  • Taxes and licenses
  • Travel and meals
  • Utilities
  • Wages
How to create an expense report?

Most businesses use accounting software to create an expense report, while others use word processing or spreadsheet programs. Here is an outline of the process in general:

1. Label the report.

List the name and contact information of the company at the top of the report.

2. Establish the appropriate columns.

Here are some typical purchasing details you may wish to include:

  • The date of purchase
  • Where it was purchased
  • The client, account number, or project with which the purchase was associated
  • Who made the purchase, which may be different from the person preparing the expense report?
  • A notes field for explanatory details that don’t fit into another category
  • The amount of each expenditure, including any taxes and gratuities paid
3. Enter the transactions. 

After the expense categories and column headings are set, enter the individual transactions into the document.

4. Calculate subtotals and totals.

Calculate a subtotal for each expense category shown on the form, and then add all of those to get a total for the report.

5.  Attach the receipts.

Attach the receipts for each expense as documentation

6. Collect any necessary signatures.

Most companies require a signature from the person presenting the form as well as the signature of the authority to approve the expense

Once all required signatures are obtained on paper or electronically, the expense report is ready to submit.

About Finline!

Finline is an online platform for creating financial reports for getting bank loans and investments. It’s like ‘Canva’ but for financials. If you are an entrepreneur looking for a bank loan, you need to have a well-crafted project report. We, at Finline will help you with that. Our team will help you create a powerful business plan in ten minutes. That too in your language. All public and private sector banks working in India accept our project report. Click to create your report.

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How to Measure Small Business Performance?

As an entrepreneur, we know how crucial it is to identify what functions well in your company and what doesn’t. The only thing you can count on in business is that things will change constantly. So that you can identify what is successful and what is not, you must continuously evaluate your company’s performance. You must measure business performance regularly as an entrepreneur.

 Since business is unpredictable, you can depend on constant change. So how do you gauge the success of a small business?

You must monitor pertinent business metrics, also referred to as key performance indicators, that show a measurable value and the advancement of the company’s objectives if you want to assess business performance.

How is performance measured?

Because of the ongoing changes in the market environment, it’s crucial to continuously monitor and evaluate your company’s goals and performance to stay competitive.

Set goals 

What do you hope to accomplish? Your objectives include attracting new clients, raising customer satisfaction, and increasing website traffic. Once you know what you want to measure, you can only measure what you have. Some examples of business objectives:

  • Generating leads
  • Boosting sales
  • Improved client services
  • Raising the profit margin
  • Upping production effectiveness
  • Obtaining a larger market share
Develop key performance indicators 

The KPIs are benchmark ratios that shed light on the operation of your company. Financial statements or revenue generated per employee are two examples. Using these performance indicators, you can assess performance about the goals you’ve set.

Businesses will set KPIs differently. So it’s crucial to pick KPIs that matter to your company, can be measured, and produce results to help you reach your objectives.

Define suitable metrics 

Business metrics are quantifiable indicators to track and assess a specific business process performance. Depending on your business and objectives, you should focus on particular metrics. These include online metrics, accounting, and financial metrics, sales metrics, and marketing metrics. These metrics keep customers, investors, business owners, and employees informed about how a company is doing.

Track and measure 

Focus on the data you believe is most important to track. Select a few primary business objectives, create corresponding KPIs, and concentrate on monitoring and gathering pertinent data.

Measuring methods of business performance
Financial statements of a company  

When you run a business, money is essential. Without it, your enterprise is finished. You can expand and grow your business using it. The income statement, balance sheet, and cash flow statement are the three primary financial statements that your small business can use.

The income statement displays your company’s profits and losses and calculates your profitability over a specified period. The balance sheet, which calculates how much you owe and own, demonstrates your company’s financial health. Additionally, the cash flow statement indicates that your company has liquid cash. This is a very crucial step in measuring your business performance.

Eye on customer satisfaction

Customer satisfaction is an essential indicator of small business performance. If your customers are unhappy with their purchase from your company, they won’t return. How are customer satisfaction levels determined? There are various methods, such as surveys and reviews. Customers assist us in creating new products. Please pay attention to their needs and learn how to meet them.

The growth rate of revenue 

The rate at which a company’s income, or sales, are increasing is known as revenue growth. Start by calculating the total annual revenue for your company to determine the revenue growth rate. Then, divide current income by incremental revenue from the prior year to assess the growth rate. You can now consider whether growth is accelerating or slowing down.

Accounts payable turnover 

Accounts payable turnover measures how quickly your company pays for goods and services over a specific period. Knowing your supplier costs will help you determine whether you need to make any spending cuts.

Relative market share 

Using the relative market share, you can determine how much of a specific market your company controls. The market share demonstrates how well a business performs compared to its rivals. You can strategically improve your product and service to increase long-term profitability for your company after determining your relative market share.

Average new customers you get 

Check to see if the customers making purchases are returning ones. To keep track of customers, create a client list with email addresses. This will make it simple for you to calculate the monthly or yearly growth in the customer base.

You can gauge your company’s effectiveness at luring new customers by periodically averaging your new clientele.

Conduct performance reviews 

Attempt to hold performance evaluations twice a year. This demonstrates how well they accomplish their tasks. In addition, performance reviews give employees insight into their workload and show them where to improve.

The employee can then be given tasks to complete to boost workplace productivity without adding more employees to the payroll.

Monitoring the development and progress of any business requires continual performance measurement. It entails comparing a company’s actual performance to its intended goals. Monitoring your company’s performance regularly will shield it from organizational or financial issues. As a result, businesses benefit from lower process costs, increased output, and more successful missions.

About Finline!

Finline is an online platform for creating financial reports for getting bank loans and investments. It’s like ‘Canva’ but for financials. If you are an entrepreneur looking for a bank loan, you need to have a well-crafted project report. We, at Finline help you with that. Our team will help you create a powerful business plan in ten minutes. That too in your language. Our reports are accepted by all public and private sector banks working in India. Click to create your report.

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Which loan scheme is best for business?

The requirement for funds varies for each business. As per the type of business, the scale of operation, repayment capability, amount of fund required may change. Business entity faces a lot of difficulties to get the right kind of financial assistance for different activities. The Government of India offers different types of supporting packages to start a business. But many of us don’t know many details about the benefit plans provided by the government. Here are some popular and top schemes for business in India from which you can choose as per the requirement and eligibility.

1. MSME Loan in 59 Minutes

This scheme, also known as PSB Loan in 59 minutes, was launched by the Government of India. PSB Loans in 59 minutes is an online marketplace, which allows business individuals to apply for a business loan at an interest rate of 8.50% onwards. Under this scheme, MSMEs can get loan amounts from INR 1 lakh to INR 5 crores in less than 59 minutes. Which business/enterprise is eligible for this loan scheme? 

  • The business must be an existing one.
  • The borrower should have Login ID of psbloasnin59minutes.com, 
  • GST, IT compliant 
  • Should have last 6 months’ bank statement.
  • Income/Revenue statements
  • Good Repayment Capacity of the Borrower
  • Existing credit facilities
Read More: What are PSB Loans in 59 minutes?
2. Pradhan Mantri MUDRA Yojana (PMMY)

MUDRA stands for Micro Units Development and Refinance Agency Ltd. MUDRA provides refinancing assistance to Banks and NBFCs for lending to Micro units. Units having loan requirements up to INR 10 lakhs can apply under the scheme of Pradhan Mantri MUDRA Yojana. Under PMMY, MUDRA divided the loan into three categories as ‘Shishu’, ‘Kishore’, and ‘Tarun’. Eligibility for MUDRA Yojana are:

  • Applicant age limit of 18 years and a maximum of 65 years.
  • Individuals, startup firms, business owners, entrepreneurs, SMEs, MSMEs are eligible.
  • Traders, Artisans, Manufacturers, Retailers, etc. engaged only in trading, services, and manufacturing sectors are also eligible.
  • If the applicant’s requirements in less than 10 lakh.
  • Applicants with good repayment history, no bank dues.
  • People belonging to SC/ST/OBC category.
  • Applicants with no loan defaults with any financial institution.
3. Credit Guarantee Fund Scheme for Micro and Small Enterprises (CGFMSE)

The CGMSE was first launched in the year 2000 as a monetary support scheme. It offers collateral-free credit for both new and existing business units. The scheme provides working capital loans up to ₹ 10 lakhs. However, for all credit facilities above ₹ 10 lakhs and up to ₹ 1 crore, an asset created through the credit facility which is associated with the business unit is also considered as security when the loan amount exceeds ₹ 10 lakhs. 

The Guarantee Cover is available to the extent of a maximum of 85% of the sanctioned amount of the credit facility. The fees charged by the trust funds are 1% per annum. The eligibility criteria covers already existing or newly established enterprises who are engaged in the following activities are eligible for this scheme,

  • Manufacturing activity
  • Retail trade;
  • Educational institutions;
  • Self-help groups;
  • Training institutions. 
  • Service activity
4. National Small Industries Corporation (NSIC)

NSIC is an ISO-certified Indian Government enterprise under MSMEs. They provide subsidy for small businesses offers two kinds of financial benefits – Raw Material Assistance and Marketing Assistance. Under the marketing support, funds are given to SMEs for enhancing their competitiveness and the market value of their products and services. The NSIC is mainly centered on supporting small and medium enterprises that wish to improve their manufacturing quality and quantity. To encourage the growth of MSMEs, NSIC provides various schemes:

  • Marketing Support Scheme – Marketing support is significant for the development of any business. To support such enterprises, NSIC devised schemes such as Consortia and Tender Marketing. NSIC forms Consortia of MSMEs working on behalf of MSMEs to reduce their burden, in Marketing Intelligence and Exhibitions, and Technology Fairs.
  • Credit Support Scheme – Under this scheme, NSIC grants finance for raw material procurement, finance for marketing activities. 
5. Credit Linked Capital Subsidy Scheme (CLCSS)

CLCSS is an innovative credit scheme launched by the Ministry of MSMEs. The primary objective is the technology updating of MSMEs, especially in rural and semi-urban areas. Under this scheme, businesses can opt for a 15% subsidy on investment in eligible machinery. However, there is a maximum cap on the subsidy restricting it to INR 1 crore. Sole proprietorships, partnership firms, co-operative, private, and public limited companies come under the ambit of this business loan scheme. The benefits to small scale industries are:

  • It provides a 15% subsidy for purchasing plant, equipment, and machinery
  • Help small-scale industries to enhance the latest and required technologies.
  • It promotes the growth of rural industries which can now manufacture high-quality products.

The above mentioned schemes need detailed documentation and  project report. With Finline, you can create project report/business plan for your bank loan. 

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How do I write a Project Proposal?

If you want to get the money from the bank to accomplish your business requirements, the first step towards getting the loan is writing a project proposal for a bank loan. When you plan a project proposal to get a loan, remember that you are writing to inform and persuade lenders. But also writing a document that can be used as a projection and guide for yourself and your business.

What Does a Project Proposal Include?

A strong project proposal for a loan application will include the following elements:

1. Cover Page and Table of Contents

The cover page should look professional, and contain the name of your business and your contact information. If you have a logo, it should go on the cover.

2. Executive summary:

The summary is written to give a complete overview of the company. Describe the company, your product, and why you started the company. Introduce your chief competitors and why your product will succeed against the competitors of the company:

3. Company Description:

The management team of the company is the major representative. The company description should include a mission statement, the company principles, and strategic partners, and your corporate structure. The banker is interested in knowing how the projects of the company are running.

4. Market Analysis

Provide a competitive analysis of your market. Identify the existing gaps that your business will fill. A business plan’s market analysis should include:

  • An industry overview and outlook
  • Any differentiation in the sector
  • Information on your target market
  • The company’s marketing strategy and how it will make your company stand out
5. Organization and Management

The description should include an organizational chart, a structure description, and salary forecasts, management position, the person in the position, their responsibilities, and their qualifications, Board of Directors.

6. Service or Product

The service or product section should include What do you sell?  Whom do you sell to? What need are you fulfilling? Also, your product/service’s estimated lifecycle, and any research and development, any trademarks, patents, if applicable.

7. Marketing and Sales

Specify your plan for customers to identify your products or services. Define what your efforts will be. Will you be on social media channels? Which ones, and why? Which types of customers?

 This section also includes information on your growth strategy.

 If you plan extensions to other geographic areas or other types of possible customers,

8. Financial data:

The financial statements and the financial forecasts for 3 to 5 years. This information enables the bank to know your ability to repay the loan. The financial projections must include:

  • Income statements
  • Cash flow statements
  • Capital expenditure budgets
  • Balance sheet
  • Break-even Analysis

A break-even analysis is the calculation and study of the margin of safety of a company.

  • Business Ratios

Projected ratios are used to assess and analyze the performance of a business. to understand your business’s potential and also serve as a goalpost for your planning.

9. Funding Request

Here’s one way you can structure your funding request:

  • Your current funding needs.
  • Any future funding requirements over the next five years.
  • How you intend to use the funds you receive.
  • Any strategic future financial plan
10. Human resources management

Explain that your business can recruit, develop and retain the right people to move your business project.

 After you have finished writing the proposal, attach all those documents that support the details you have given in the proposal. Make sure that the details provided in the proposal match the supporting documents.

About Finline!

Finline is an online platform for creating financial reports for getting bank loans and investments. It’s like ‘Canva’ but for financials. If you are an entrepreneur looking for a bank loan, you need to have a well-crafted project report. We, at Finline will help you with that. Our team will help you create a powerful business plan in ten minutes. That too in your language. Our reports are accepted by all public and private sector banks working in India. Click to create your report.