3 Ways to Plan Your Business Finances with Tata Capital Business Loans

by Gopal Gidwani on April 20, 2017 · 0 comments

in Others

Developing a financial plan is an important aspect of every business. Such a plan helps enterprises determine their financial position. It also helps businesses ascertain if they have sufficient capital for daily operations and other activities like growth and expansion. In case firms do not have sufficient cash inflow by means of revenue, they may borrow from external sources. Numerous banks and Non-Banking Financial Companies (NBFCs) provide commercial loans at attractive interest rates.

Tata Capital, one such financial service provider, offers business loans to companies seeking funds. Enterprises may use such funds for numerous purposes, as per the needs of the business. Following are three ways firms may utilise the obtained capital to plan their business finances.

  1. Make long-term investments

Some businesses borrow funds from external sources to make long-term investments. Borrowing to invest is known as gearing, which results in huge returns if the investor is highly experienced and well-versed with the market. Moreover, gearing offers higher investment amount and tax benefits. Businesses may invest the borrowed amount along with their existing business funds as a higher investment amount leads to higher returns. Loan seekers also enjoy tax benefits on the interest payments of the business loan. The interest paid on the repayment of the loan is deductible from the gross income.

  1. Build credit

Credit Rating Information Services of India Limited (CRISIL), a global analytical company, provides a credit score to every business based on its financial position. This score depends on the firm’s current assets and liabilities and past repayment of debt. Higher the credit score, greater will be the credibility of the business. Tata Capital not only provides hassle-free loans to firms with a high score but also offers attractive interest rates. Some firms borrow a short-term loan in order to build their business credit. Availing of a loan and making timely repayment increases the firm’s credit for the future. This enables firms to apply for large-scale financing in the long run. It also helps businesses build relationships with the lender, thus ensuring that they get access to credit as and when required.

  1. Finance business activities

It is imperative for any business to have sufficient access to funds in order to function smoothly. Finance is required to hire new talent and pay salaries to the existing employees. Firms may also require capital to purchase inventory, buy equipment, and upgrade their existing technological systems. Finance is also needed for covering marketing expenses and paying taxes. All these activities need cash inflow, which may be obtained through a Tata Capital business loan.

Businesses may, therefore, apply for a commercial loan through Tata Capital and easily finance their business operations. Tata Capital offers loans to cater to every business need, through its working capital loans, term loans, startup loans, equipment finance solutions, and overdraft facilities. Therefore, entrepreneurs may avail of a loan based on their business needs and meet their capital requirements easily.

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