Seasonality of Business Loans

Seasonality of the Business

• A permanent business with regular sales throughout the year is a key requirement; businesses with only seasonal sales are not eligible.
• Seasonality is evaluated based on the regularity of primary activities throughout the year, which is verified through documentary evidence (if available).
• Loan proposals will not be considered if there is little to no business activity during the off-season.
• Businesses involved in standalone perishable items are to be avoided due to:
  • Low shelf life
  • High wastage
  • Low capital intensity
  • Low barrier to exit

Credit Bureau Check

• Report validity is 30 days, counting from the disbursement date

Eligibility Criteria

• No current delinquency allowed in any existing active loans
• Any discrepancy in the bureau report must be justified with a No Objection Certificate (NOC) from the financial institution
• New To Credit (NTC) cases are permitted based on the business profile, cash flow, and financials of the customer
• No instances of more than 60 Days Past Due (DPD) in the last 12 months, meaning no continuously missed 2 EMIs in active loans for the past year

Loan Conditions

• No Repayment Obligation delinquency is allowed
• The customer should not have any Non-Performing Asset (NPA), Written-off, Settled Account, Doubtful, or Sub-standard accounts

Approval

• Any deviations from the above criteria must be approved by the Head – Credit

Learn about the seasonality of business and its impact on loan eligibility. Understand the guidelines for business loan proposals and what to avoid.