Federal Bank, one of the leading scheduled commercial banks in India, provides business loan at attractive interest rates that starts from 10.35% onwards. The bank majorly focuses on fulfilling the financial needs of Micro, Small and Medium Enterprises (MSMEs). Let us explore the various business loan products offered by Federal Bank along with their features and repayment options.
Federal Bank Business Loan Interest Rates – 2020
|Type/Category||Interest Rate (Fixed) p.a.||Repayment Tenure|
|Loans to SMEs – Manufacturer/ Service/ Trader/ Contractor||12.95% onwards||Up to 2 years|
|Micro Business Loans (Aggregate credit limit up to Rs. 25 Lakh)||12.25% onwards||Up to 2 years|
|Small Business Loans (Credit limit above Rs. 25 lakh to Rs. 2 crore)||12.35% onwards||Up to 2 years|
|Commercial Vehicle Loan|
|Up to 2 years|
Related Post: What is the interest rate on MSME Loan?
Additional Funding Facilities for loan amount up to Rs. 5 crore
- Bills discounted under LC: 11.50% onwards
- Micro credit to Kudumbasree and similar schemes: 12.50% onwards
- Supply Bills Discounted/Documentary Bills Purchased/Usance Bills Discounting: 14.50%
- Swarojgar Credit Card/General Credit Card: 12.80% onwards
Note: The above mentioned interest rates, fees & charges may change and shall depend on the sole discretion of the bank and RBI, GST and service tax are not added in the mentioned charges and will be levied extra.
Repayment Tenure: Up to 120 months
The below mentioned entities are eligible to apply for Federal Bank business loans:
- Self-employed professionals
- Private and Public Limited Companies, Sole Proprietorship, Partnership Firms, Limited Liability Partnerships (LLPs)
- Any other legal entity engaged in Trading, Services or Manufacturing sectors
Note: NBFCs and Companies dealing with Export Credit, Chit Fund and Real estate are not eligible to apply for federal bank business loan
Documents Required for Federal Bank Business Loan
- Passport-sized photographs
- Well drafted and detailed Business Plan
- Identity Proof: Passport, Voters ID card, Driving License, PAN Card
- Address Proof: Utility Bills (Water/Electricity Bills), Passport, Ration Card, Trade License, Lease agreement
- Last 12 months’ bank account statement
- Last years’ ITR along with copy of Trade license and Establishment and Sales Tax certificate
- Last 2 years’ ITR, Sales tax returns
- Last 2 years’ audited financials
- Any other required by bank at time of loan submission
Features of Federal Bank Business Loan
Following are the key specifications of Federal Bank Business loan:
- The bank provides different loan products for all individuals to SMEs and MNCs which suit the financial requirements of everyone.
- Fast process of loan disbursal
- The bank also offers low processing fee
- Attractive interest rates ranging between 10.35% – 15.40% per annum
- Flexible repayment options available
- Minimal documents are needed in order to apply for a Business Loan.
Federal Bank – Repayment Options for Business Loan
Federal Bank offers flexible repayment options. The borrower can repay the loan in any of the following form:
- FedNet – Internet Banking
- Mobile Banking
- National Automated Clearing House (NACH)
- Standing Instructions (SI) at nearest bank branch
How to Apply for Federal Bank Business Loan
Federal Bank Business Loan offers multiple business loan products that cater to different sections of business aspects. If you are looking for options and want to apply for a business loan, you can visit at Paisabazaar.com where all the comparisons of banks business loans along with interest rate and features are available.
Toll Free Numbers: 1800-420-1199
Frequently Asked Questions (FAQs)
Q. How many business loan products are offered by Federal Bank?
Ans. Federal Bank offers multiple business loan products catering to all the business section of the society.
- SME Parameterised Loan Scheme
- Business Loans for Professionals
- Federal Goldsmiths Loan scheme
- General Credit Card Scheme
- Loan to Mobile/ DTH/ Other electronic recharge vendors
- SME Loan against Property
Q. What is the mode of repayment in Business Loans?
Ans. One can repay the loan amount either through EMIs, Standing Instruction, Cheque or ECS.
Q. What is the final interest rate on business loan?
Ans. The interest rate is decided by the bank on the financial profile of the loan applicant. Credit Score plays an important role in finalizing the interest rate along with other credentials.
Q. For what purposes can business loan be availed?
Ans. Business Loan can be availed for all business related requirements like starting up a new venture, expanding the existing business, to avail extra funds for operational requirements, to start new business related projects etc.
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