The right loan lets a trading business buy more stock and take bigger orders. The wrong one drains your margin. Here is how to choose and how to qualify.
For stock and day-to-day cash, a working-capital loan, cash credit or overdraft fits better than a long-term loan. For a one-time expansion, a term loan makes sense. Borrowing the wrong type costs you in interest and flexibility.
Register on Udyam and check schemes aimed at small businesses, which often carry lower rates or easier terms than a plain commercial loan. Many traders qualify and never apply.
Lenders want GST returns, bank statements and simple books that show steady sales and repayment ability. Keeping your billing and records clean through the year makes the loan far easier to get when you need it.
Only take on repayments your margin can cover comfortably, even in a slow month. Debt used to fund profitable, fast-moving stock helps. Debt covering losses or dead stock digs a deeper hole.
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