Business Loan Interest Rate and Fees TATA Capital

Published date: November 11, 2017
  • Location: New Delhi, Delhi, India

What is the Business Loan Interest Rate ?

At present we charge fixed interest rate in the range 18-24% for all business loans without collateral but only on the strength of the business. The rate depends on a number of factors such as the prime lending rate, credit rating of the borrower, antecedents of the business, monthly revenues, competitors and tenure of the loan. The borrower can command an interest at the lower end of the band if the scoring is high on all the parameters mentioned above.

Interest Rates and Processing Fees on Business Loans

  • Amount of loan - Minimum of Rs 3 lakhs to a maximum of Rs 50 lakhs
  • We charge Business Loan Interest Rate from 18% to 24%.

The fees and charges pertaining to the business loans are as per the table below:

Business Loan Fees & Charges

ChargesAmount
PDC ChargesRs. 850
Bouncing Charges (per event)Rs. 450
Cancellation Charges2% of business loan amount or Rs. 5750 whichever higher
Duplicate NOCRs.550
Swapping Charges (for payment mandate)Rs.600
Foreclosure Charges4.5% of the principal outstanding at the time of foreclosure along with applicable taxes, if any
Foreclosure Charges for Top Ups2% on future principal outstanding on existing business loan + GST
Duplicate Repayment ScheduleRs. 550
Legal action under Section 138 of Negotiable Instruments Act, 1881, and/or Section 25 of Payments and Settlements Systems Act, 2007Rs. 3400
Initiation of Arbitration proceedingsRs. 4000
Obtaining of Receiver Order from a District CourtRs. 4000
Obtaining of Receiver Order from the High CourtRs. 13500
Issue of Legal Notice (per notice)Rs. 125 to Rs. 300
Execution of AwardRs. 5600

How is Business Loan Interest calculated ?

The interest is calculated on a monthly reducing balance method. In this method, when the EMI is paid monthly a portion of it is accounted against repayment of principal and the balance portion towards payment of interest. Similarly, in the next and subsequent EMI payments a portion goes towards repayment of principal and the balance towards payment of interest. Thus, at the end of the tenure the entire interest and principal are repaid through equated monthly payments.

What does your interest rate depend upon ?

The interest rate depends on a variety of factors that include

  • The prime lending rate prevalent at the time of availing loan
  • The credentials of the borrower
  • The soundness of the business for which the loan is required
  • The creditworthiness of the borrower and the business
  • The tenure of the loan
  • Monthly revenues of the business

If your creditworthiness is high and the business credentials are sound then you are likely to be charged at the lowest rate of interest which is 18%.

Are you eligible to take a business loan ?

You are eligible to avail a business loan if you are a self-employed businessman or professional running the business in any of the following ownership formats

  • Proprietorship
  • Partnership
  • Private Limited Company
  • Closely held Public Limited Company
  • Society
  • Trust

We also have a special business loan plan for pathological labs, diagnostic centers, nursing homes and hospitals.

The business loan eligibility criteria are set liberally so as to benefit a large number of businessmen and professionals to easily avail business loans for the enhancement of their business or profession. They include

  • Age of borrower to be within 15 and 65 years
  • Three year profitable profile for the business
  • Turnover to be in excess of Rs 40 lakhs per year
  • Turnover to show increasing trend
  • ITR filing in excess of Rs 3 lakhs income
  • Financials to be audited by CA

The main features of the business loan include

  • Rs 3 lakhs to Rs 50 lakhs loan amount
  • Interest rate between 18 and 24%
  • Loan tenure between 12 and 36 months
  • Three EMI options

You can check your detailed eligibility criteria for business loan before applying.

How Much EMI do you have to pay ?

Our business loans can be repaid with three EMI options. You can choose your own EMI option based on your comfort level. To help calculate your EMI we provide you with a Business Loan EMI calculator. EMI is a function of three variables - the loan amount, tenure and interest rate. You can use the calculator to change the variables and see which EMI is the most suitable for you.

What are the documents needed ?

We seek copies of standard documents from you that establish your credentials as per the eligibility criteria set by us as given above. They include

  • Standard application form with passport-sized photographs
  • Documents to comply with KYC norms
  • Two-year ITR
  • Two-year balance sheet and profit & loss statement for the business
  • 6-month bank statement certified by bank
  • Documents to confirm ownership
  • Documents to confirm proof of business by statutory authorities

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