Can homemakers start a business with a Personal Loan?
March 15, 2020
An increasing number of homemakers now also run successful small businesses. But a common problem for several homemakers with entrepreneurial dreams is the initial funding to start their business. Can homemakers get a Personal Loan to start a business? Read this post to find out.
Modern homemakers are ambitious and can perfectly balance their household responsibilities while also achieving their entrepreneurial dreams. If you are a homemaker with a desire to run your own small business, one of the most important things, apart from a solid business plan, is the initial funding.
If you do not have adequate savings to start your business, you will have to rely on external sources to fund your business idea. Can homemakers get personal Business Loans to start their business? Let us have a look.
Eligibility requirements to get approved for a Personal Loan
One of the most important considerations for a lender to approve a Personal Loan application is the income of the applicant. The lender would like to make sure that the applicant has a steady source of income, which will allow him/her to repay the loan. Unfortunately, in the case of homemakers wanting to start a business, this steady source of income is missing.
As a result, homemakers are not eligible for standard Personal Loans. But there are several other options that homemakers can consider receiving funding for their new venture.
Loan options for homemakers
If you are a homemaker looking for loan to start a business, here are the options that you can consider:
1. Personal Loan with a co-applicant
While you might not have a steady source of income to get approved for a Personal Loan, your spouse, parent, sibling or child might. They can be added as a co-applicant for Personal or new Business Loans.
As your application will now have a co-applicant with a steady source of income, the lender could approve your request if you meet the other basic loan requirements.
2. Add a loan guarantor
If you are sure that your business will generate adequate revenue in the future to help you repay the loan on time, you can also consider the option of adding a guarantor in place of a co-applicant. The guarantor can be someone with a steady source of income and an excellent credit score.
In case you are unable to repay the loan, it will then be the responsibility of the guarantor to repay your loan.
3. Secured Loan
A Personal Loan is an unsecured loan that does not require you to keep any collateral or security against the loan amount. But if you are not eligible for an unsecured loan like a Personal Loan, you can consider secured loans like Gold Loans or Loans Against Property or Security.
This will allow you to get a loan by keeping your gold, property, equity or bonds as collateral against the loan amount, and the lender will no longer require you to have a source of income.
4. Government schemes
If none of the above options suits your requirements, there are also a few Government Personal Loan schemes that you can consider. For instance, you can apply for a loan under Pradhan Mantri Mudra Yojana for Women or Udyogini Scheme.
These schemes allow homemakers to get a Personal Loan for small business. You can consult a top bank to know more about these Government schemes.
Fulfilling your entrepreneurial dream with a Personal Loan
Now that you know all the different ways in which homemakers can get a loan to fund the start-up of their business, it shouldn’t be difficult for you to select a method that best suits your requirements.
Make sure that you select a reputed bank that offers many different types of loans at competitive interest rates to fulfil your entrepreneurial dreams in the best way possible.
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