Becoming an independent consultant engineer or starting an engineering business after gaining a few years of work experience, is a common practice among engineers these days. The obvious benefit of this is that it allows you to be your own boss and have complete autonomy over your time and finances.
On the other hand, you will have all the responsibilities that come with the position. And one of these is finding financing for your business, whether it’s for expanding, consolidating your market position, or something else. Now there are many options when it comes to financing an engineering business, including loans from banks and/ or NBFCs like Bajaj Finserv.
One such loan is Bajaj Finserv’s Engineer Loan. It offers self-employed engineers a loan amount of up to Rs. 15 lakh, at very affordable interest rates. It comes with a line-of-credit facility, that allows the borrower to borrow just the amount they need when they need it, and pay only the interest as EMI.
Moreover, this business loan for engineers comes with a flexible repayment option, and allows the borrower to prepay the borrowed amount anytime within the tenor, at no additional cost.
With features such as these, professional business loans have become a popular option to avail finance. However, it is not the only option and it is really important that you find the right financing option for your company’s needs. There are certain steps that you can take in order to find this option:
1. Determine the Need
The first step towards knowing which type of financing would suit a company best, is determining the need for it. If you, as an engineering business owner, don’t know what you need the money for, you won’t be able to avail the right type of financing. Even among loans, there are different types, and each is suited for a specific purpose.
For example, if you need to fund your working capital, a working capital loan would suit you best. But, if you’re looking to expand your business by buying a new office, a business loan may be best suited for you. If you’re looking to purchase equipment for your firm, an equipment loan would help meet your need.
2. Determine the Amount
After determining the need for financing, the next step is to know how much you’ll need. Since different financing options offer different amounts, it is necessary to know how much you need, to choose the best option for your company. Unsecured loans may be among your better options, since they come in various types and offer different amounts as per your need.
3. Get Your Finances in Order
Before applying for (or acquiring) any type of external finance, you need to set your own finances in order. If you are looking to apply for a professional loan for engineers, you’ll need to have all your financial and identity proof documents readily available for submission.
Moreover, before lending you money, lenders look at your credit history and score to ensure that you can pay the loan back. So, you’ll need to ensure that your credit score is good, or at least that you have a plan of action to repay the money, before applying for a loan.
4. Make A List of Options
From banks, to NBFCs, to investors, your sources of finance are vast. Make sure that you have a comprehensive list of options of these sources, so that you can choose the one that best suits your company’s requirements. Besides business and professional loans, you can also go for equity or asset finance. Just be sure of the risks and requirements of each source of finance, before you apply.
Once you’ve taken these steps and chosen the best option for you, you are ready to go get your money! If you’re going for an engineer’s loan, be sure to compare the engineering loan interest rates, before applying. You also have an option of checking your eligibility and applying online!