Loan Against Property

 

Godrej Capital's Loan Against Property (LAP) is designed to support business growth with high loan eligibility, flexible EMIs, longer tenures, and a wide range of acceptable collaterals. This loan provides substantial funding based on property value, making it ideal for significant business investments and expansions.

 

Key Benefits | Interest Rates | Calculators | Documents Required | FAQs

Udyog Loan Against Property

 

For MSMEs aiming for growth, Godrej Capital Business Loans for small businesses offer the funds needed to expand their business and manage cash flow. Apply for MSME loan without collateral today!

 

Key Benefits | Interest Rates | Calculators | Documents Required | FAQs

Commercial Property Loan

 

Take your business to the next level with a Commercial Property Loan that finances construction, extension or improvement to make your business goals become reality. With plans designed for your life, you can rest assured that your business empire is in safe hands.

 

Key Benefits | Interest Rates | Calculators | Documents Required | FAQs

Balance Transfer

 

Transfer your existing loans to Godrej Capital and experience the benefits of lower interest rates, flexible repayment terms, and significant EMI savings. Enjoy higher eligibility, along with a top up loan, to take care of your extra needs.

 

Key Benefits | Interest Rates | Calculators | Documents Required | FAQs

Home Loan

 

Seeking a Home Loan to buy a ready-to-move-in property, an under-construction house, or renovate your current residence? Our Home Loan, featuring low interest rates and flexible EMI plans, is specifically designed to help you accomplish buying your dream home.

 

Key Benefits | Interest Rates | Calculators | Documents Required | FAQs

Plot Loan

 

Found the perfect spot to build your future? Our Plot Loans can help make it yours. Our loans offer you the financial help, low interest rates and flexible payment options you need to construct the home of your dreams.

 

Key Benefits | Interest Rates | Calculators | Documents Required | FAQs

Professional Loan for Doctors

 

Whether you need working capital to start your own clinic or upgrade your current practice with new facilities and hire skilled staff, our Professional Loans for doctors are here to help you. Apply today for a collateral free loan today!

 

Key Benefits | Interest Rates | Calculators | Documents Required | FAQs

Professional Loan for Doctors

 

Whether you need working capital to start your own clinic or upgrade your current practice with new facilities and hire skilled staff, our Professional Loans for doctors are here to help you. Apply today for a collateral free loan today!

 

Key Benefits | Interest Rates | Calculators | Documents Required | FAQs

Professional Loan for CAs

 

Godrej Capital's Professional Loan helps CAs in expanding practice, hiring new staff, enhancing equipment, and upgrading services for business growth. Get a loan without collateral and take your career to new heights.

 

Key Benefits | Interest Rates | Calculators | Documents Required | FAQs

Business Loan for MSMEs

 

For MSMEs aiming for growth, Godrej Capital Business Loans for small businesses offer the funds needed to expand their business and manage cash flow. Apply for MSME loan without collateral today!

 

Key Benefits | Interest Rates | Calculators | Documents Required | FAQs

Business Loan for Women

 

Are you a woman entrepreneur? Godrej Capital's Business Loans for women-owned MSMEs help them fuel growth and meet business needs without any collateral. Apply for a small business loan today!

 

Key Benefits | Interest Rates | Calculators | Documents Required | FAQs

Business Loan

 

Empower your business with Godrej Capital's Business Loan, offering flexible financing solutions to help businesses take the next step for growth. Apply for online Business Loan without collateral today!

 

Key Benefits | Interest Rates | Calculators | Documents Required | FAQs

Overdraft

Is an Overdraft Facility Better Suited for Your Business Than a Term Loan?



In today's fast-paced and competitive world, businesses often need access to funds to navigate through various financial needs. The most common source of financing for businesses remains loans. However, how to choose if your business needs the consistency of a term loan or the flexibility of an overdraft facility?

 

Both have advantages and disadvantages, but here, we will explore the benefits of an overdraft facility and analyze whether or not it could be a better option for your business than a traditional or term loan.

 

What is an Overdraft Facility or Overdraft Loan?

An overdraft facility is a type of loan option provided by lenders to their customers, allowing them to withdraw money based on their convenience from a pre-determined limit. This flexibility can be beneficial for businesses that experience fluctuations in cash flow throughout the year or have seasonal income variations. An overdraft is typically a short-term financing option that can be used to cover day-to-day operational expenses or unexpected costs.

 

Advantages of Overdraft Facility:

  1. Flexibility: One of the main advantages of an overdraft facility is its flexibility. Businesses can access funds as and when needed, up to a specified limit, without the need to reapply for a loan each time they require additional funds.

     

  2. Cost-Effective: Overdraft facilities allow borrowers to withdraw and repay money based on their convenience from a sanctioned limit, with interest being charged only on the utilized amount. This gives customers the flexibility to pay less interest payment as opposed to traditional business loans.

     

  3. Cash Flow Management: An overdraft facility can help businesses manage their cash flow effectively by providing quick access to funds during periods of financial strain.

     

Also Read: Understanding Overdraft Facility: A Simple Explanation

 

What is Dropline Overdraft?

A Dropline Overdraft is a financial tool that allows borrowers to withdraw cash from an agreed limit. The withdrawal limit decreases from the sanctioned amount at a set period, and interest is only charged on the withdrawn cash, instead of the total borrowing limit. Deposits can be made at any time to decrease the outstanding balance. Interest is calculated daily and charged at the end of each month.

 

For example: In a monthly dropline overdraft, if the initial tenure is 60 months and the original overdraft limit is INR 10,00,000, the operating limit will decrease by INR 16,666 each month. For example, after one month, the available limit will be INR 9,83,334. This reduction continues each month until the end of the repayment tenure.

 

Overdraft Facility or Term Loan: Which is better?

While overdraft facilities offer several benefits, they may not always be the best financing option for every business. On the other hand, traditional business loans like term loans provide a lump sum amount upfront, which can be useful for funding large capital investments or long-term projects. Additionally, business loans typically have a fixed term and repayment schedule, allowing businesses to plan their finances more effectively.
 
Read more: Overdraft Facility vs. Term Loans: Making the Right Financial Choice

 

How to choose if your business needs a term loan or an overdraft facility?

Purpose of Financing: Consider the specific needs of your business and the purpose for which you require funding. If you need short-term, flexible financing for day-to-day expenses, an overdraft facility may be more suitable. However, a term loan might be a better choice if you are planning a long-term investment or expansion project.

 

Cost of Financing: Compare the interest rates, fees, and terms associated with overdraft facilities and term loans. Calculating the total cost of financing can help you determine which option is more cost-effective for your business in the long run.

 

An overdraft facility can be a valuable financial tool for businesses looking for short-term, flexible financing options. However, it is important to carefully assess your business's financial needs and compare the benefits of an overdraft facility with those of a traditional business loan. Ultimately, the decision between an overdraft facility and a business loan will depend on your business's specific requirements, financial situation, and long-term goals.

 

What are Godrej Capital Flexi Funds?

Godrej Capital recently introduced Flexi Funds, an overdraft-like facility, that can be used by borrowers interested in opting for an unsecured Business Loan or secured loan options like Loan Against Property and Udyog Loan Against Property. Flexi Funds acts as a smart financing solution for businesses that require flexible access to funds. This facility provides five dropline variants, competitive interest rates, easy access to funds through an online portal, and financial agility to adapt to market conditions and seize opportunities confidently.  

 

Dropline Options: Flexi Funds Variants 

 

Hybrid Dropline

Annual Dropline

Half-Yearly Dropline

Quarterly Dropline

Monthly Dropline

 

The sanctioned limit is to remain fixed for the first two years, with the withdrawal limit reducing every month thereafter.

 

 

Withdrawal limit to reduce every year from the sanctioned limit in equal proportion.

 

 

Withdrawal limit to reduce half-yearly from the sanctioned limit in equal proportion.

 

 

Withdrawal limit to reduce every quarter from the sanctioned limit in equal proportion.

 

 

Withdrawal limit to reduce every month from the sanctioned limit in equal proportion.

 

 

Also Read: Loan Against Property versus Loan Against Property Flexi Funds: Which One Fits Your Needs?

 

Disclaimer: The contents of this article are for information purposes only and not a financial advisory. The information is subject to update, revision, and amendment and may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject Godrej Capital or its Affiliates to any requirements. Godrej Capital or its Affiliates shall not be responsible for any direct/indirect loss or liability incurred by the reader for making any decisions, financial or otherwise based on the contents and information mentioned. For more information, please visit www.godrejcapital.com