Business Loan

Loan for hotel and restaurant businesses


Are you searching for the finest business loan? Looking to start your restaurant and hotel business? The answer to your inquiry will be found here. so long as you keep these important things in mind before starting the loan for the hotel. Here are some crucial factors that will increase the impact of your decisions. Let’s have a look.

The opening of a restaurant, a chain of restaurants, or a café is one of India’s most popular businesses. By 2018, it is anticipated that the restaurant sector will grow by 11% annually. The process of getting money to run a restaurant includes several different variables. Such are the business model, recruitment, personnel, licensing, branding, advertising, and marketing. To attract consumers, a new restaurant needs to do a lot of marketing and promotion. The initial costs of branding, advertising, and marketing may be equal to a new restaurant’s operating expenses.

Some important things to consider when applying for a loan for a hotel or restaurant

Restaurant Loans: Eligibility Requirements

Although the procedure for acquiring loans for restaurants is straightforward and the interest rates are reasonable, it’s crucial to realise that there are a few fundamental requirements. The following requirements must be met to qualify for a loan for restaurants:

  • Guarantor: A person or company who can promise to pay if you are unable to repay the loan.
  • Collateral: An asset that is pledged as security to the institution that is making the loan for the hotel until it is fully repaid.

An initial, upfront payment that is indicated as a percentage of the total loan amount is called a down payment. Many places require the borrower to pay for part of the project while the loan for hotels pays for the rest.


Term loans for capital expenses might range in term from more than a year to five years.

Assistance with short-term working capital is due in 12 months.

Using the asset itself as security, lenders also offer asset-based loans for hotels to cover the cost of assets like real estate, business premises, stock, and specialised gear.

Different SME Loan Programs Offered to Restaurants

To fulfil the needs of SMEs, banks offer a variety of loans for businesses. Term loans are for large investments, with loan terms ranging from one to ten years. Long-term working capital loans and high interest rates for urgent demands. Business loans are those that can be secured using assets like stock, machinery, and real estate as collateral. Any sort of restaurant loan requires the provision of guarantees in addition to a guarantor.

The loan for restaurant application form must be submitted with the following documents:

Documents needed to apply for a business loan.

  • Voter identification
  • A driver’s licence
  • A passport
  • Aadhar card
  • A telephone bill
  • Electricity bill
  • A registered sale or lease deed serves as proof of identity.
  • Bank statements for the past year
  • The past year’s sales tax returns
  • ITR business address
  • Historical evidence
  • Certificate of Company
  • SSI or MSME registrations
  • Applicant’s current net worth
  • Rental agreement with a pollution clearance
  • Fire Department NOC with FSSAI Certificate approval from the appropriate state

An online restaurant loan application process

It’s simple and hassle-free to apply for business loans for restaurants.

For a restaurant loan, apply online: Online processing of applications is available. You must enter some basic pieces of information on the bank’s website. On the websites of banks, you can find tools (EMI calculators) to help you understand what your EMIs will be like. Upload all necessary documents for a business loan. The applicant must upload every one of the needed papers. It won’t take long, because there’s not much documentation. Paying back a loan: The borrower has all the time throughout the process. The loan will be disbursed very quickly.

A Business Loan for Hotels and Restaurants’ Highlights

  1. There is an available overdraft facility with a maximum business loan amount of Rs 30 lakh.
  2. Acceptance in 24 hours
  3. Two records are necessary for the application.

Interest rate

  • Interest rate: 15% to 20%
  • Process charges
  • 3% maximum of the loan sum
  • Rs. 50 in loan statement fees
  • Charges for interest and principal statements
  • Zero EMI bounce fees
  • up to 3000 rupees (inclusive of applicable taxes)

Following is a list of the business loan clientele profiles that are taken into account:

Allopathic physicians, chartered accountants, corporate secretaries, and architects who are self-employed in their professions are examples of self-employed professionals (SEP). Qualification documentation that will be shared

Self-employed non-professionals (SENP) include business owners, proprietors, traders, manufacturers, and service providers, among others.

Partnerships, limited liability corporations, private limited companies, and closely owned limited companies are examples of entities. Other constitutional categories based on each individual’s characteristics


This article’s goal is to provide a thorough analysis of loans for hotel and restaurant businesses. You should have thorough knowledge of your company loan before making any decisions about it. You should have a thorough knowledge of your loan for the restaurant before making any decisions about it. The items listed above will make it easier and more successful for you to obtain a business loan. Before applying for a restaurant loan, compare the features and interest rates offered by different banks to find the best deal, but most importantly, consider the items listed above.

Also visit Piramal Finance, which has more in-depth, educational, financial-related articles.