Financial problems are a part of life and can come at the most unexpected moments of your life. Nevertheless, things can get difficult if you lack sufficient assets to get approval for a standard loan. Entrepreneurs experiencing such economic challenges may leverage their inventory. Inventory funding is a viable option if you can’t satisfy customer needs or have to release funds that are locked up in inventory.
Inventory is among the most crucial assets of any company. Consequently, before choosing to use this financing option, it is crucial to understand the benefits it entails.
Go to the Piramal Finance Inventory Finance page. Read the features and eligibility criteria, and start the application process.
Click on Apply Now
Fill in the required Personal details such as Name, Contact Number, Birth Year, and Business Loan Amount.
Choose the employment type 'Salaried' OR 'Self-Employed'
Add your monthly income
Select the State and branch (enter the branch by city) and Submit the short term loan application form.
Wait for a call from the official representative to move ahead with the processes.
Inventory financing or inventory funding is an asset-backed loan that can be used to borrow money against the entire or a portion of the company’s inventory or stock. The lending institution determines a certain percentage depending on the company’s inventory valuation to determine how much of a loan is given.Depending on the number of stocks, Piramal Finance will select and decide its own percentage and provide a different interest rate. In this case, the inventory secures the loan by serving as collateral. Companies and entrepreneurs who own and oversee substantial amounts of inventory can use this form of financial instrument. Manufacturers, merchants, suppliers, and distributors may leverage inventory financing to buy goods.
The process of obtaining funds for all or a portion of your inventory is known as inventory financing. Businesses obtain a loan against inventory based on the anticipated value that can be recovered via selling the inventory offered as collateral. Depending on these criteria, creditors determine the loan’s repayment plan and proceed.Since they frequently have their capital restricted due to a longer cash conversion process, businesses that manufacture and sell consumer goods, such as cars and FMCG products, are more likely to rely on various types of inventory financing. If accessible, this financing could be utilized to increase sales.
Creditors offer two types of inventory financing to companies. The type of inventory financing that the company decides on depends on its business operations. The type of business determines the fees and interest rates.
Here is the list of the costs associated with choosing inventory financing:
Although various types of inventory are available in the market, the major ones include raw materials and components, work-in-progress, maintenance and repair, finished goods, and operational supplies.
Your business must have a strong sales history, dependable order fulfillment, no recent substantial losses, and the ability to take on a sizeable loan minimum.
Here are the steps to follow while applying for Inventory Financing from Piramal Finance:
Inventory financing is the computation of a company’s financial health, efficiency, and liquidity, and it’s decided via a simple formula: Current Assets - Current Liabilities.
Yes, it is a type of debt-based finance for firms.
The inventory that was utilized to finance it serves as collateral. Smaller, privately held enterprises without access to other finance sources frequently utilize inventory financing. Companies depend on it to update product lines, maintain a consistent cash flow, boost inventory inventories, and meet high demand.