A major part of India’s economic growth depends on the contribution of the Small and Medium enterprises. Although their products and services are greatly valued by certain sections of the society, many SMEs fail to find a ground in the long run. This happens mostly because of the lack of adequate research and planning by entrepreneurs about the potential possibilities and associated risks related to the particular niche of Business operations. Such SMEs and MSMEs face challenges due to inaccurate assessments of their working capital requirements, and even if they do, they are unable to find proper MSME financing options for business expansion.

At this new age, innovative financing solutions are coming up with the advent of latest technology trends. Despite such improved availability of SME finance, many businesses are still suffering. Let us look at some common financing mistakes made by SMEs which mostly relate to estimating the correct amount of business loan required, assessing the full financing cost, wasting time on getting business loans approved and the opportunity costs.

Deficit in research and planning

Planning for a sought-after business is great responsibility. Unfortunately, some business owners tend to get over involved with daily business operations and troubleshooting, and in the process they fail to look at the bigger picture. They are not able to foresee the amount of cash they would require for their business growth. All of a sudden, they are caught up in a cash crunch, and hence, they are unable to meet their working capital needs. To combat the issues stemming from the right inflow of cash at the right time, online lenders like Tab Capital have come to the forefront. While traditional lenders mandate stringent rules and regulations before approving business loans, TAB Capital approves unsecured business loans in just 2 working days!

Compelled to pay hidden charges

Sometimes SMEs and MSMEs are burdened with exorbitantly high hidden charges, and business owners are not even aware. TAB Capital offers MSME financing to small businesses without charging any hidden fees on them. You can also prepay the MSME loan without any prepayment charges if you opt for an online MSME loan from TAB Capital.

Putting too much at stake as collateral

More often SMEs tend to put too many assets as collateral to secure their business loan. In the long run, they are doomed with financial fears of losing their assets. TAB Capital offers MSME loans without collateral, and many other long-term benefits.

Incorrect estimation of required funds

Some business owners are sceptical about overestimating their cost and loan requirement, for having to pay interest on excess funds. This makes them underestimate costs and even after getting a loan, they are struck with a need for more.

Opting for the wrong SME Financing option

Often SMEs and MSMEs turn towards borrowing money from unorganized money lenders, and end up being in the receiving end because these loans are not tailored to the specific needs of the SMEs. New age digital lenders like TAB Capital over customer-friendly MSME loans, which are customized as per your business needs.

Any delay in arrangement of funds at a given point of time can prove catastrophic for a business. But TAB Capital’s digital lending platform eliminates the unexpected financial bottlenecks paralyzing a business growth by quick, customer-friendly MSME financing models.

Reach out to TAB Capital for all your financial needs!