How to Get a Business Loan Without Collateral: The Steps
19 March, 2025
Synopsis
You can avail of a Business Loan of up to ₹50 Lakh (or ₹ 75 Lakh in select cases) without pledging assets as collateral.
You can choose a flexible loan tenure ranging from 12 to 48 months, tailored to suit your business needs.
Make the most of the dropline overdraft facility to ensure smooth and efficient cash flow management.
When you are running a business, financial requirements will arise from time to time. This may include working capital, expansion funding, equipment purchase, marketing & advertising spending, emergency funds, or debt refinancing. You may plan these requirements, or they may arise unexpectedly. In either case, you will need a significant amount of money to meet them. Applying for a Business Loan is an easy way to meet your financial needs.
The HDFC Bank provides the Collateral-Free Business Loan to support your journey. As the name implies, you do not need to pledge your assets as collateral to get the Loan. This means you can borrow a substantial amount without putting your assets at risk.
In this blog, we will explain how to get a Business Loan without collateral:
Benefits of Collateral-Free Business Loans
The following are the various benefits
Higher Loan Amount
You can get a Loan of up to ₹50 Lakh and, in select cases, up to ₹75 Lakh. The bank sanctions a considerable Loan amount based on your eligibility. This means you will have enough funds to meet your requirements.
Competitive Interest Rates
The bank offers a Collateral-Free Business Loan at an attractive interest rate, making Equated Monthly Instalments (EMIs) relatively manageable.
Suitable Tenure Options
You can select a tenure ranging from 12 to 48 months. This allows you to repay the Loan without compromising your financial well-being.
Adaptable repayment terms
You can repay the amount in EMIs over the chosen tenure. You can also make part-payments without bearing any penalties.
Flexibility usage
Use the Collateral-Free Business Loan amount to meet any business financial requirement. HDFC Bank also extends the dropline overdraft facility. This enables you to withdraw the Loan amount as needed from the Current Account. The bank will charge interest only on the amount used.
What are the Eligibility Criteria for a Collateral-Free Business Loan?
You can apply for a Business Loan without collateral if you fulfil the following:
Self-employed individuals, sole proprietors, private limited companies, partnership firms, involved in manufacturing, trading, or services can apply for the Collateral Free Loans.
The minimum turnover of the business should be ₹40 Lakh.
The minimum experience of the current business should be 2 years. The total business experience should be 5 years.
Businesses that have been profit-making for the previous 2 years.
The business should have a minimum annual income (ITR) of ₹1.5 Lakh per annum.
You must be at least 21 years old and no older than 65 years at the time of the loan application.
Documents Required for Collateral-Free Business Loan
PAN Card – Company/ firm/ individual
A copy of identity proof (Aadhaar Card/Passport/Voter ID Card/PAN Card/Driving Licence)
A copy of address proof (Aadhaar Card/Passport/Voter ID/Driving Licence)
Bank Statements of the previous 6 months.
ITR for the previous 2 years. It should include income computation, a Profit & Loss account, and a balance sheet. It should be certified/ audited by a CA.
Proof of continuation – ITR/Trade license/Establishment/Sales Tax Certificate.
Other mandatory documents may include sole proprietor declaration or the Certified copy of partnership deed, the certified true copy of the Memorandum & Articles of Association (certified by the director), Board resolution (original)
How to Get a Business Loan Without Collateral: The Steps
Explained below are steps to apply for a Business Loan. Note that steps can differ across banks:
Access the HDFC Bank website or mobile banking app.
Enter your registered mobile number and, subsequently, the generated OTP.
Enter your PAN Card number.
Consent to various permissions to proceed with the application process.
Check your eligibility to get a Collateral-Free Business Loan.
Choose the Loan amount.
Enter and verify your details.
Scan and upload documentation required for the Loan approval.
Click on “submit”.
The bank will take reasonable time to process your Business Loan request.
They may ask for additional details and documents on a case-by-case basis. Prioritise meeting their requirements.
Get Convenient Business Loans from HDFC Bank
Are you in a financial fix for your business? Quick Business Loans without collateral can be a viable solution. You can borrow a lump sum amount without pledging your assets as collateral. This ensures your financial needs are addressed without risking your assets.
The HDFC Bank Collateral-Free Business Loan is simple yet offers numerous benefits. You can borrow up to ₹50 Lakh, in some cases up to ₹75 Lakh. Enjoy a competitive interest rate and can repay the Loan in EMIs over your preferred tenure.
You can opt for the dropline overdraft facility and utilise the Loan amount as needed.
Apply for a Collateral-Free Business Loan with HDFC Bank right away!
FAQs
What is a Collateral Free Business Loan?
The Collateral-Free Business Loan does not require you to pledge your assets as security to get the Loan. This allows you to borrow money without risking your assets.
How does a Collateral-Free Business Loan work?
The working of the Collateral-Free Business Loan is very simple. You do not need to provide collateral to obtain the Loan. The HDFC Bank provides you with a Loan solely based on your eligibility.
What is the advantage of the Collateral-Free Business Loan?
The top benefits of Collateral-Free Business Loans are no risk of assets, large Loan amounts, competitive interest rates, flexible tenure, and repayment terms.
What are the steps involved in applying for a Business Loan?
Visit the HDFC Bank branch or access their website/ app to apply for a Business Loan.
How long does the Business Loan application process take?
The HDFC Bank processes your Loan request within 7 working days from the date of application. However, this may vary on a case-by-case basis.
Apply for a Collateral-Free Business Loan.
*Disclaimer: Terms and conditions apply. The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Business Loan at the sole discretion of HDFC Bank Limited. Loan disbursal is subject to documentation and verification as per Bank's requirement. Interest rates are subject to change. Please check with your RM or closest bank branch for current interest rates.
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