Banks offer business loans for various needs of enterprises like expanding, modernizing or improving infrastructure. Though any business person can opt for a long or short term business loan, there are certain eligibility that needs to be fulfilled. Unless sure of your eligibility including your capacity to pay back the loan amount, no bank will give your any business loan.
There is also need of submitting various documents while applying for a business loan. There are differences in the documents required for various types of companies like sole proprietorship firm, partnership firms and private limited companies. The documents needed may also vary slightly depending on the bank you have applied for the loan. Generally the following documents are required by banks for providing a business loan for a sole proprietorship firm:
Proof of identity of the sole proprietorship firm.
Proof of individual identity of the proprietor.
Proof of residence address of the proprietor.
Certified balance sheet of the enterprise for last two years.
Copies of IT returns for the last two years.
Bank statements of last 6 months for business credit up to Rs. 15 lakh and last 12 months for business credit above Rs. 15 lakh.
If the case of a partnership firm proof of identity of the partnership firm as well as proof of individual identity for all the partners along with balance sheet of the last two years have to be submitted along with a copy of the partnership deed. If you are applying for a loan for a limited company, then proof of identity of the limited company, copies of memorandum and articles of association, certificate of incorporation, board resolution, copy of annual return establishing the shareholding pattern need to be submitted at the time of applying for the business loan.
However, when applying for a business loan check with the bank about the exact documents needed by them for providing the loan.