Dairy farm owners in India can expand their business by securing a dairy loan from reputed financial institutions. Being a major contributor to the Indian GDP, a dairy farm business entails several expenses, including raw materials, product processing, storage and warehousing, etc.
Therefore, with the help of a dairy farm loan, one can conveniently finance these expenses and aim towards business growth. Here is everything a dairy business owner needs to know before procuring a loan.
Features of a dairy business loan
Among the several types of business loans in India, a dairy farm business loan comes with a several attractive features. Some of them are as follows:
- Speedy approval: Business owners can effectively get funds and meet their dairy requirements by securing this financial tool. With its easy-to-meet eligibility and minimal documentation, lenders approve these loans in no time.
- Collateral-free loans: Individuals with a dairy start-up need not pledge collateral while applying for this financial instrument. Therefore, they can secure their personal or business assets during the process of gathering funds for business expansion.
- Flexi-loan facility: Unlike regular business loans, a dairy farm loan comes with a flexi-loan facility. In this process, an individual can withdraw funds from a pre-sanctioned credit limit as per his/her requirement. A borrower needs to pay interest only on the withdrawal amount and not the entire loan amount. Further, this facility gives an option to pay interest-only EMIs for the initial days of the repayment tenor.
- High-value loan amount: Reputed financial institutions offer a high-value loan amount to business owners procuring a dairy farm business loan. In addition to this, NBFCs like Bajaj Finserv provide pre-approved offers for a seamless loan application process. The offers are valid for a range of financial products and services like personal loans, credit cards, etc. One can check their pre-approved offers by submitting basic details like their name and phone number.
- Repayment flexibility: Dairy business owners can modernise their farming infrastructure, acquire raw materials, supplement the manufacturing process and more by choosing a dairy loan. Several lenders offer flexibility in repayment tenor to individuals with a good credit score.
Therefore, it is evident from the above points that business loans can keep any business financially healthy.
Moreover, business entrepreneurs can increase their chances of loan approval by following certain eligibility criteria.
Eligibility for a dairy farm loan
To avail of a quick and hassle-free loan, dairy business owners must meet the following eligibility factors:
- They should be between 24 to 70 years of age.
- Their credit score should be higher than 685.
- They must have a dairy business running for at least 3 years.
Upon meeting these requirements, an individual can successfully grow his dairy product or dairy farm business and expect a rise in revenues.
Other than this, business owners also need to present few documents while applying for this loan.
Documents required for dairy farm business loan application
Individuals planning to expand their dairy business can apply for a dairy farm loan that requires minimal paperwork. Here is a list of documents they need to present during the application process:
- KYC documents like PAN, Aadhaar, Voter ID, Driving License etc.
- Address proof documents like electricity or water bill, rent agreement, passport etc.
- Financial documents like Income Tax Returns, bank account statements, GST returns, CA-audited balance sheets.
- Business ownership proofs like proof of sole proprietorship or business ownership deeds.
After presenting these documents, lenders will disburse the loan amount, which will be reflected on a borrower’s bank account in a short span.
Therefore, it is imperative that securing a dairy loan is a simple and less time-consuming process. Dairy business owners in India can effectively utilise the funds obtained to distribute products, establish manufacturing units, purchase equipment, buy animals and their shelters and more. Further, this financial instrument is ideal for entrepreneurs who wish to expand their businesses.