A Cash Credit Loan (CCL) is a type of short-term business loan offered by banks and Non-Banking Financial Companies (NBFCs) to meet their working capital requirements. It is a revolving line of credit that allows the business to withdraw money from the credit facility whenever needed up to a pre-approved limit. This flexibility makes it ideal for managing day-to-day expenses, inventory purchases, payroll, and other short-term needs.
Cash Credit Loan Interest Rates
The interest rate charged on cash credit loans or working capital loans differs across banks and is subject to change periodically. The applicable interest rate is determined based on the borrower’s credit profile and financial track record.
| Loan amount | Starting from ₹50,000 |
| Loan Tenure | Up to 12 months, may exceed as per business requirements |
| Interest rate | Starting from 11.99%* p.a. |
*Note: The interest rate and loan amount may vary from lender to lender and is based on the applicant’s creditworthiness.
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Top Banks & NBFCs Offering Cash Credit Business Loan
The below mentioned table shows the business loan interest rates offered by top banks and NBFCs:
| Top Bank/NBFCs | Interest Rate |
|---|---|
| Axis Bank | 14.95% – 19.20% p.a. |
| Bajaj Finserv | 9.75% – 30% p.a. |
| Flexiloans | 1% per month onwards |
| HDB Financial Services Ltd. | Up to 36% p.a. |
| HDFC Bank | 10% – 22.50% p.a. |
| IDFC First Bank | 10.50% p.a. onwards |
| Indifi | 1.50% per month onwards |
| Kotak Mahindra Bank | 16% – 26% p.a. |
| Mcapital | 2% per month onwards |
| NeoGrowth Finance | 19% – 24% p.a. |
| Tata Capital | 12% p.a. onwards |
| UGRO Capital | 9% – 36% p.a. |
Note: The above mentioned interest rates are subject to change. DO visit the official website for updated interest rates.
Eligibility Criteria of Cash Credit Loan
The eligibility criteria for Cash Credit Loans (CCLs) can vary depending on the lender, loan amount, and type of business. However, some general criteria are common across most lenders:
Registered business: You must be a registered business entity like a sole proprietorship, partnership, limited liability company (LLC), or private limited company (PLC).
Business vintage: Most lenders require a minimum business age, typically 2-3 years, but some may go as low as 1 year for established businesses.
Turnover and profitability: Demonstrating consistent revenue and profitability over the past few years strengthens your application.
CIBIL score: A good CIBIL score (650+) is preferred, indicating responsible credit history. So, check your credit score and go through your credit report.
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Documents Required For Cash Credit Loan
Specific documents may vary depending on the lender, loan amount, and business type. Always check with the specific lender for their exact requirements.
Duly filled application form: With passport-sized photographs.
KYC documents: Aadhaar card, PAN card, voter ID, or other government-issued photo ID and address proof.
Business proof: Registration certificate, PAN card, license, GST certificate.
Financial statements: Latest audited balance sheets, profit & loss statements, and bank statements (6-12 months).
Income proof: ITR returns for the past 2-3 years.
Features & Benefits of Cash Credit Loan
Cash Credit Loans offer flexible funding, letting you draw on a pre-approved line, pay interest on what you use, and repay at your own pace. Here is the brief overview of features and benefits of Cash Credit Loan:
Features:
Short-term: Typically 12-18 months, offering quick access to funds.
Flexible: Draw funds as needed within your sanctioned limit.
Interest: Pay interest only on the amount withdrawn, not the entire limit.
Revolving: Repay and redraw funds as needed, keeping the line active.
Collateral: Often required, varies depending on lender and loan amount.
Benefits:
Improves cash flow: Covers immediate expenses and temporary cash gaps.
Cost-effective: Potentially cheaper than overdrafts or credit cards.
Supports growth: Funds inventory, marketing, or expansion plans.
Financial discipline: Encourages budgeting and cash flow management.
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Steps to Apply for Cash Credit Loan
Follow the below mentioned steps to apply for a cash credit loan:
Step 1: Visit buddyloan.com or Download & install the Buddy Loan app (Android or iOS).
Step 2: Open the business loan application page. Enter your mobile number and OTP.
Step 3: Specify the desired loan amount and email. Next, choose the Business Loan option.
Step 4: Choose if you have a Business Proof (Yes/ No)
If ‘Yes’ (If you have a business proof), enter your business and personal details.
Or
If ‘No’ (If you do not have a business proof), choose the profession type and enter your personal details.
Step 5: Provide income details and Click the ‘Submit’ button.
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