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How business financing is helpful in 2025

What is business financing? How do I get it? How much does it cost? Even large-cap companies often search for other sources of funding to satisfy their short-term needs. A small company must choose the right kind of business financing for its needs. Business financing is the process of providing funds in exchange for some form of collateral or other security. The term “financing” is typically reserved for larger companies that do not have cash flow enough to purchase assets, such as machinery and inventory. If you don’t pick where to receive financing properly, you might be in for a big loss. This is why you must check the repayment conditions and interest rate to go forward. [B-01] Financing decisions play a key role in the company’s development. They are usually taken up by people who have the needed expertise. One needs to be sure of their financing needs. This will help in choosing the correct business financing role. During these times when companies are funded, financing has a long way to go. In old times when the funding spree was not going on for start-ups, owners had to borrow money. They used to go to banks or NBFCs for capital. But now, business financing is made easy. Keep reading to learn more about this. Why should you consider obtaining a business loan? Working hard is the road to success. But, you should also have some cash on you. Many small company owners get business loans when they want funds to keep their operations running. If you don’t earn enough money to cover your expenses and stock up on supplies, you may need to take out a loan. Manufacturing facilities often take out loans to pay for the pricey capital equipment they need. Marketing campaign spending for publicity of the company’s goods or services is essential, but it may be costly for a startup. To cover charges, you may need business financing. The value they offer to your company’s culture, operations, and bottom line may make hiring excellent team members costly. It would be simpler to identify and recruit individuals who can help your company expand if you can acquire a loan. Save some money in case of urgency. This includes equipment breaking down or a client not paying on time. You may need to take out a loan to keep your company running during these difficult times. Applying for a business loan may be time-consuming. There are a few things you can do to ensure your application is as perfect as possible, regardless of the kind of loan you wish to apply for. It might take anything from a few minutes to a few hours to apply for a business loan. The owner decides to finally choose the right loan provider. Let’s go through the remaining four options for getting business financing. Bootstrapping Many successful businesses adhere to the notion of launching a firm with their cash, and this strategy does as well. This is called bootstrap. They don’t need business financing. Owner financing is the use of one’s own money and resources. It is essential if you want to keep your expenses as low as feasible. The control of the company is not diluted. Ownership lies with the founders. When the government distributes money or reduces tax rates, it is called “subsidy financing.” · Sales provide the funds required for the firm to remain open and running well. Cash from Investors Venture capital, abbreviated as “VC,” is a form of private equity. It is a business financing whose primary purpose is to make high-risk investments in early-stage, non-publicly listed enterprises. Venture capital differs from private equity in that it invests in a new company’s expansion capital. This kind of business financing is ideal for organizations that have progressed beyond the “seed stage” and are searching for funding in series A or series B. Most venture capitalists do not immediately invest in new enterprises. As a result, its purpose is to assist organizations in growing quicker than they would on their own, such as when a company wants to go worldwide. Angel Investors Angel investors are also known as “private investors.” They are wealthy individuals who assist small firms through a business loan in return for a stake in the company. On occasion, angel investors are also referred to as venture capitalists. They are also referred to as “seed investors”. They are frequently the first to put money into a new enterprise. Angel investors often provide smart funding as well. In addition to financing financial help for a project, they often give their knowledge and networks in the same industry. As a result, having an angel investor whose expertise and business financing abilities are comparable to those of your organization’s sector is beneficial to your firm. Many outstanding firms are performing well in the market today due to the expertise and resources brought to the table by their angels. [B-02] Summing up If you want to acquire business financing, you will need proper information about the same. Debt financing is without a doubt the most convenient option for a small company to get funds. This is true even if the company owner lacks financial support from family or friends.
08-11-2023
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Home Loan

A Guide on How and When to Apply for a Home Loan

When it comes to home loans, people generally have a lot of questions and confusion. The entire process is quite nuanced, after all, it involves a huge amount of your hard-earned money. Multiple financial organisations are ready to help you with every financial requirement but there are certain decisions that you have to take for yourself. This article will guide you through the right procedure to follow while availing of a home loan. [B-01] How should you apply for a home loan? The process of becoming a home-owner can be very stressful but in the end, you know it’s rewarding. Here’s a step-by-step guide that’ll help you apply for a home loan with ease: Step 1: Fill out the application form and gather and submit all the necessary details and documents. The application form will require a few of the below-mentioned details: Name and other personal details of the applicant Residential details of the applicant The monthly or annual income of the applicant Employment details of the applicant Educational details of the applicant The estimated cost of the property the applicant is availing loan for Property details Current means of financing the property A few of the other documents that are required by the applicant to submit are: Age proof Identity proof Income/salary proof Address proof Educational proof Employment details Bank statements Final property details and proof Step 2: Once the form is filled and the documents submitted, you have to pay the processing fee to the bank. This amount is to be deposited to the bank to maintain the loan account. The amount is usually some percentage of the home loan requested. The percentage could vary from 0.25% to 0.5%, depending on the bank you choose to avail of the loan from. Step 3: After all this is done, the bank will take its time to go through all the documents and details submitted by the applicant. This usually takes about three to four days to get done with. Once the bank is done going through, there will be thorough scrutiny and verification of the details provided will take place. The bank will get some representative to primarily examine the applicant’s residential and employment details such as the credentials of the employer, workplace contact number and so on. The references provided by the applicant are also contacted to do a background check of the applicant. Step 4: After all the examination is done, the bank will then move forward to give its verdict. This is where the entire process hangs, the loan could either be approved or rejected based on how convinced the bank is with the application and is sure that you will be able to pay the bank back. Once the loan is sanctioned by the bank only then can the process move forward. Step 5: Once the bank decides in your favour, a certified offer letter is sent over to you. The offer letter contains the following information: The amount of loan you’re eligible for The interest rate you’ll be charged on the total loan amount Details about the interest rate (variable or fixed) Means of loan repayment Terms, conditions and other policies regarding the loan After the offer letter is read and agreed to, the applicant is supposed to send the signed duplicate copy to the bank for their records. Step 6: Technical examination of the property purchased is followed thereafter. The bank sends a technical expert to check the site the applicant is planning to buy. The inspection includes information such as the quality of the construction, the surroundings of the property, the layout of the house, etc. Step 7: After all this is done and the bank is completely satisfied, the final registration deal is signed, and the loan agreement is then signed. The applicant is to submit cheques (post-dated) for the decided duration by the applicant and the bank. The loan amount will finally be disbursed in the account, in parts or fully, as the bank allows. After all the legal check is done and agreed upon, the loan is disbursed either in parts or fully. When should you apply for a home loan? It might not seem like it but considering the time you apply for a home loan could prove to be extremely crucial during the process. There are a few factors to keep in mind and in check while deciding when you should apply for a home loan. Let’s take a look at what those are: When you’re sure that your monthly income is stable and good: unless this condition is met, letting some amount of money be taken from your bank account every month as part of EMI, will take a big hit on your day-to-day activities. When the interest rates are lower: low-interest rates mean low EMIs to be paid and therefore less financial burden on you. The flow of interest rates could be either fixed or variable. When you’ve worked for a considerably long time: if you’ve recently started working the bank might not see you eligible enough to pay back a home loan and there’s a good chance you’ll be rejected. Whereas if you have good numbers of professional experience behind you, the bank will know that you have a higher repayment capacity. When you have cleared your other obligations: if you’re already under other loan-related obligations such as personal loans or educational loans, you will have to deal with increased responsibility and even more stress to pay the bank back. Other than this if you already have other amounts to pay back the loans sanctioned alongside will be less and less and thus might not be enough to get a home loan. This will also help you boost your credit score and hence lower interest rates will apply. [B-02] Conclusion It’s important to understand and know your options when it comes to availing of a home loan, hoping this article helped you in making a sound decision. Along with this, there are multiple resources on the internet that can help you recognize all things finance, but isn’t it better to learn from the best? Piramal Finance is your key to the best. Learn and explore as much as you want to.
08-11-2023
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Tips & Advice

Here Are the Top 5 Golden Tips for First-Time Home Buyers

Most people make their biggest investment when they buy a home. Buying your first home is one of the most important moments of your life; it is just like going on your first date or getting your first job. When buying your first home, you need to learn to plan your budget, choose the right type of property, think about location and amenities, check the builder’s reputation, and get a home loan. Getting a home loan and making sure you can afford it takes a lot of work. Want to buy your first house? What are the best tips that will make the process smooth for you? [B-01] Top 5 Tips for First-Time Home Buyers in 2025 1. Manage Your Finances First, you need to figure out how much money you have and how much you will need. Prices for homes vary a lot depending on the type of property and its location. So, you must decide beforehand the amount of money you can spend. You might want an expensive house in a posh neighbourhood, but it might put a dent in your finances. A home loan eligibility calculator is one way to check how much money you can borrow with a home loan and how much you will have to repay each month. For this, you should take into account all your financial obligations. Ideally, your EMIsshould not be more than 40% of your take-home pay. You can also use a home loan affordability calculator to see if you can afford a loan. 2. Decide on the Type of Property The type of property depends on what you can afford. Think about how many family members you have, how many rooms you need, and so on. Find the best fit for your needs and your budget. You should also think about why you want to buy a house. If you want a house to live in, think about how long you plan to stay. If you are buying a house to rent it out, it is a good idea to think about what the tenants in that location are looking for. Based on the type of property and the purpose of the purchase, you can also avail yourself of some tax benefits. Under Section 24 of the Income Tax Act, you can claim up to 2 lakhs on the interest paid on your home loan. 3. Think about the Location and Amenities When buying a house, choose the right location, especially in a big city where commute times can be long. Consider where you work, how far away the schools and hospitals are from your home, how easy it is to get to public transportation, etc. Check if the neighbourhood has a proper sewage system, good road infrastructure, etc. Because the location also dictates the property prices, you should prioritise some of these factors and pick a location that best suits your budget and needs. For example, if you use a personal vehicle, you can choose a house far away from public transport hubs. If there are no children in your family, you can choose a house with no schools nearby. You should think about what kind of amenities you want and need. New apartment buildings and residential properties come with pools, gyms, spas, clubs, and so many more facilities. You should avoid getting swayed by all these amenities and pick only those that you need and will use. For example, if you have kids, you might want to buy a house with a play area. If you own a car, you will need a parking space. You should pick the extras carefully because they add to the total cost. 4. Choose a Builder with a Good Name Buying a home is a big decision, so look into the builder’s background. Check their past projects to see if they were all finished on time. You can also talk to the builder’s past customers to find out about the quality of the work and whether or not what was promised was delivered. Avoid fly-by-night companies that make big promises but do not have a reliable track record. When in doubt, ready-to-move-in units are the best way to avoid problems with builders. 5. Get a Home Loan Since buying a house is a big expense, you should consider getting a home loan. You can talk to your bank, but it is best to compare the home loan rates and features offered by several lenders. One of the most crucial steps in buying a house is getting your home loan approved. Home loans also come with some tax benefits. As a best practice, keep the length of your home loan as short as possible. Long-term loans have very high interests that may add up over time. For example, a 25-year home loan has a total interest payment of 160%, while a 10-year home loan only has a total interest payment of 55%. [B-02] Conclusion For someone who has never bought a house before, the process can be scary. But if you follow these tips, you can plan well and make buying your first home a memorable experience.
08-11-2023
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Home Loan

Navigate the Housing Loan Process with Ease: Eligibility and Required Documents

Building a dream house is most frequently found on the bucket list of many. It may be unfulfilled due to insufficient funds. But a home loan can help you build your dream house. This article is centred on a home loan, its eligibility, and the required documents. [B-01] What exactly is a Home Loan? A home loan is a financial instrument that helps you build your dream house. Home Loan is given by lenders like banks and other institutions. In most cases, the lenders will give 75-90% of the amount needed to build your house. You must pay interest till the repayment period. The repayment period for a home loan is usually very long. What is the eligibility for acquiring a Home Loan? The eligibility for acquiring a home loan differs from one lender to another. However, the most common eligibility are given below. Employment Status This is the most common factor in getting a home loan. Banks and other institutions will often provide loans for an employed person. Trusting an unemployed individual to repay is not healthy. This is because of the inability of the unemployed to repay the loan. So, you should be either a salaried employee or a self-employed person. Age The lenders will consider your age for fixing the principal amount for your home loan. This generally ranges from 21 years to 60 years. The age criteria are different for different lenders. The minimum is your age, maximum will be the chance for you to get a home loan. Credit (CIBIL) Score CIBIL score is not only important for a home loan but also for other financial activities. CIBIL Score is a three-digit number. It shows your credit history. This scale ranges from 300 to 900. It is always advised to have a minimum score of 700 to avail of a home loan. If you have a low credit score, don’t panic. It is possible to improve your CIBIL score. So it is better to check your credit (CIBIL) score online free of cost before planning for a home loan. Financial Discipline The lenders will see your past repayment history for a home loan. This will make your profile low-risk. The timely payment of EMIs and interest will also be considered. Other Financial Obligations Other financial obligations include the history of your car loan, personal loan, gold loan, etc. This will also be considered for housing loan eligibility. Experience Experience is the number of years you have worked for a company or in a particular field. In most cases, the experience should be a minimum of 2 years. A good relationship with the lender Transactions or any positive financial record with the lending institution will be of greater help. This will aid lenders to have good trust in your repayment. It sometimes decides the interest rate for the home loan. Because lenders won’t be stringent in this case. Present market conditions and Government’s steps Your interest rate is directly decided by the market conditions and the government’s steps. They include inflation, recession, etc. Inflation is the general rise in prices. If there is inflation, you will be charged a high-interest rate. A recession is a period of decline in economical activities. During the recession, the interest rate will be lower. The reputation of your organisation If you are a salaried employee, the reputation of your organization matters. If you work in a well-known company, the chances for availing of a home loan will increase. Criminal History Though most financial institutions do not consider your criminal history, some of them may take this into account. What are the documents required for getting a Housing Loan? Some of the most basic documents that are required for getting a housing loan are Filled out home loan application form. Documents for Identity proof (Aadhaar Card/ Passport/ Driving license/Voter ID card) Documents for ddress proof (Aadhaar Card/ Passport/Driving license/Voter ID card/Electricity Bill/ Ration Card/ Telephone Bill/ Employment Letter) Bank statement for the past 3 months (Passbook of previous 6 months) Latest salary slip/latest salary certificate Passport-size photograph of the applicant. NOC (No objection certificate) from builder/housing group. Signature verification by lenders. What are the benefits of a Home Loan in Piramal Finance? Minimum Documentation For the availing of a home loan, Piramal Finance will ask only for a few documents. This will save you time and reduce your burden. Principal Amount The principal amount for a home loan from Piramal Finance starts even from Rs.1 Lakh. Quick Sanction We will sanction your loan and disburse the funds as quickly as possible. Low EMI The interest rates for a home loan for the first five years will be low. This helps in easy cash management. Flexible Repayment Period To pay interest, you can choose the fixed type or floating type, or hybrid type. There is also an option for pre-closure and pre-payments. Flexible Foreclosure charges Piramal Finance offers flexibility in foreclosing your home loan. Special Offers You will also get some special offers exclusively from Piramal Finance. It includes EMI waivers, balance transfer facilities, etc. Your Dream Comes True This is the best benefit one could get from availing of a home loan from Piramal Finance. Your dream of building a house will soon become reality with Piramal Finance with these added benefits. [B-02] The Bottom Line Home loans are becoming more frequent in the financial markets. It may seem easier to get a home loan. But it is always good to approach a trustworthy lender like Piramal Finance. Piramal Finance will be your one-stop solution for your home loan. Piramal Finance provides home loans at lower interest rates. Piramal Finance has a team of financial experts who will guide you through every process. Wishing you a piece of happiness and prosperity for your dream house!
08-11-2023
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Gold Loan

Gold Loan EMI Calculator: Definition, Features & Benefits

In the modern era of loans and investment, gold, as a good collateral, has acted as a great medium for availing of a loan. This yellow metal being highly precious, can be used as a security against getting a loan from a lender. Since gold loans are a mode of secured loans, the interest rates are quite low, and there are various flexibility options for borrowers. You can get a very high loan amount against physical gold in Banks and Non-Banking Financing Companies. With so much being said about a gold loan, it is also important to compare different interest rates and calculate your EMIs. You can use an interest calculator for gold loans to make that job easier. It helps you in computing different interest rates and helps you find out the best suitable option for you. In this article, you will know everything about an interest calculator for gold loans. This article will throw light on a gold loan EMI calculator, its features, benefits, and significance. [B-01] What is an Interest Calculator for Gold Loans? An interest calculator for a gold loan is an online tool that helps you calculate the interest rate you will be paying for the loan amount. It is an easy-to-use, handy tool that requires interest rates, a loan amount, and the tenure of repayment to give you the EMI amount that you are going to pay. It is already programmed with a mathematical formula to calculate your EMI amount. In addition to that, a gold loan EMI calculator also helps you compare different options available to you. This helps you in deciding the best possible loan option available to you. In times of changing market rates, you might need to keep yourself updated with the recent interest rates, instalments, etc. In that case, an interest rate calculator for gold loans helps you keep updated with the trends and makes you aware of your payment details. Features and Benefits of Interest Rate Calculator for Gold Loans There are several features of an interest rate calculator for a gold loan and they are: EMI schedule: A gold loan interest rate calculator provides you with a detailed schedule of the EMI that you are going to pay throughout the tenure. Comparison of multiple offers: An interest calculator for a gold loan helps you in comparing different gold loan offers in the market. This helps you in deciding and availing the best option for you. You can calculate the total interest you will be paying for a certain amount at different rates and tenures. You can also calculate your EMIs for different scenarios. Information in Advance: Since you can know about your loan amount, loan interest rates, and loan tenure in advance, you will be able to decide how much amount you want to take and for how long. This will also help you to devise a financial plan before your EMI period starts and will also make you manage your budget accordingly. Saves time: Instead of using the mathematical formula to calculate the EMI amount, loan amount, etc., you can use an interest rate calculator for a gold loan. It will save a lot of time. It gives you results in less than a second and is also a huge benefit for those who want to try out different amounts simultaneously. Error-free: As the interest amount is calculated by a machine, it is impossible on its part to commit any mistakes unlike doing it through manual means. Accurate output: As the numbers are generated by an AI-generated device, you get accurate results, to the decimals, regarding your gold loan. Precision is one of the biggest benefits of using an interest rate calculator for gold loans. How to use Gold Loan EMI Calculator? To use an interest rate calculator or a gold loan EMI calculator, you need to follow these steps. Search for Gold Loan EMI Calculator. Visit any website of the bank that is equipped with a gold loan EMI calculator. Now, enter the principal amount of the gold loan in the first bar of the calculator. In the second bar, enter the rate of interest of the gold loan that your lender is offering In the third bar, enter the tenure of repayment of the gold loan within which you have to repay the amount. Now click on the ”calculate”option to get the EMI amount of the gold loan on your screen. You will be able to see your EMI amount, how much interest you will be paying, and the total repayment amount. You can use the interest rate calculator for a gold loan to compare various gold loan plans for lenders. You have the benefit to get a detailed report about all the terms and conditions of the loan along with the interest rate, EMI amount, etc. This will provide you with clear-cut information regarding your gold loan. [B-02] In Conclusion: Gold loan EMI calculators are of great help while calculating your loan amount, interest rates, EMI amount, etc. It is handy, easy to use, effective, diligent and gives accurate results in no time. The results are free from errors as it comes from an AI-generated source. It helps you compare different interest rates, and updates you with the latest rates in the market. If you want to know more about the interest rate calculator for a gold loan, personal loan, home loan, business loan, etc., you should visit Piramal Finance.
08-11-2023
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Business Loan

Finance Your Logistics Startup Idea with Business Loan

Logistics has always played a vital role in trade. Logistics is the part where you handle the operations. Supply of goods on time and in good shape is the goal here. Recently its need seems to be increasing. Customers can now order goods directly to their homes. Thus, there is a growing need to keep the supply chain smooth and steady. And to ensure this, you need the right business financing. Lately, there are numerous sources to finance your business. All of them vary in their ease of use. One of the most popular and easiest ones is taking a business loan. [B-01] Why do you need a Business loan? It is understandable if you are doubtful about taking a business loan. Most middle-class families think of it that way. But taking a small business loan is completely normal for a firm. Here are some of the reasons you might be benefited from taking a business loan. I. Expanding your Business The most common way to grow a business is to reinvest the profits. But this is a slow and gradual process. This may take you years. To expand your business now, you can take a business loan. Expansion might mean that you would require capital. This capital can be arranged with the help of a loan. II. Regular Cash Flow Sometimes you face a cash crunch. Even during covid, many businesses face such a problem. A logistics business may not always get paid at the time of delivery. Sometimes there might be a gap between the delivery and the payment. A small business loan can be taken to overcome such situations. III. Working Capital Requirements You might get a large order. In this case, you might need to rent more trucks. Or you might need to hire drivers. In such a case you would need cash until you get paid. By taking a business loan you can finance your short-term requirements. IV. Building Credit Score When you are a new startup owner, you might take up a small business loan. Regular payment of this would help you build your credibility. So, whenever you will need a bigger loan in the future, you can show your brilliant credit history. How to Get a Business Loan Application Passed? To get your business financed you would need to comply with the regulations. To secure yourself a business loan, follow these steps: I. Create a Business Plan It becomes vital to the lender that you have a profitable venture. So prepare your business plan thoroughly. You must include your objectives. The plan should show your revenue-generating streams. This would assure the bank that you can repay the loan. II. Have Your Documentation Ready To get your business loan application approved, ready all your documents. Make sure you have all your documents with you before applying. The entity’s evidence, most recent income tax returns, audit reports, KYC paperwork, bank statements, etc. are among the documentation that lenders seek. III. Research All Your Options Different institutes have different criteria to assess your business. You have the option to look beyond conventional lenders too. Non-Banking Financial Institutes(NBFIs) and digital lenders are also some options. Compare these options. Choose the one most suitable to your needs. IV. Identify what the Lender Assesses Always research what the lender sees as a risk. Identify the problem area. By working on these areas, you’ll be able to minimize the interest rate. For example, lenders often look out for defaults in your credit history or inconsistent revenue. Ensure that your logistics business is free of such markers. Eligibility Criteria Different lending institutes have different eligibility criteria. Usually, the following qualifications are initially checked: Minimum Turnover: Rupees 10 lakh Age Requirements: Above 21 and below 65 years old Business Activeness: 2-3 years Credit Score Value (Credit Information Bureau (India) Limited): 700-900 Documents needed for Business Loan As listed above it is very important to have all the documents required to get a business loan. Various businesses have various needs. documents required for a loan application mostly remain the same. Let’s discuss in detail which documents you would need in the process. First of all the form should be accompanied by a recent passport-sized photograph. Other requirements are: KYC Documents This includes Aadhar Card, Drivers License, Voter ID card, and Pan Card. It also includes address proof. This can be your passport, utility bill, rent agreement, etc. You would also need a bank account statement for the last six months. Proof of Business Documents You would also need documents to prove the existence of your business. This consists of proof of business documents, a return of GST statement, two years of income tax returns, registration documents, and the business address. Primarily, the form must be filled accurately with a recently clicked passport-size picture. [B-02] To Conclude Startups in the logistics industry incur a lot of operating costs. As a result, you also require money for capital expenditure. To operate your business and grow it, you often need a loan. Here is where a business loan would be beneficial. Business financing is important because of the time gap. A logistics company typically waits a while before receiving payment from its customers. But in the meanwhile, it has to pay its suppliers, staff, and merchants. It may become considerably more difficult for logistics companies to pay their debts if clients’ payments are delayed. So, if you own a logistics business and need money for expansion or more immediate needs, you should think about getting a business loan from a reputable bank or lending institution. When in doubt, think about speaking with Piramal Finance. Piramal Finance is a top-notch source of funding. They also provide professionals and business owners with specialized lending alternatives. Look at their free credit report tool. You can calculate how much you need to borrow and how much you must pay in EMIs with the aid of their specialists. Check out the Piramal Finance Website now and find answers to all your financial queries.
08-11-2023
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Home Loan

Here are the pro tips to manage your home loan

Are you looking for a home loan? Want smart tips from experts? A home loan is a long-tenure loan hence, it needs your commitment for a longer period of time. Here are some useful tips related to your home loan and how you can manage it better. [B-01] What is a home loan? You can get a home loan for the purpose of buying a home from a bank or NBFC. In the case of a home loan, the property’s owner (the borrower) hands over the deed to the loan provider. The lender will return the deed once all payments and other terms of the loan have been met. Smart Tips to Manage Your Home Loan ● Manage Your Finances First Cash flow management should be your primary focus when dealing with loans and investments. First, it’s important to sit down and create a monthly budget and do everything in your power to stick to it. You’ll be able to better monitor your finances if you do this. Don’t forget to factor in both the monthly outflow of funds in the form of payments and the monthly inflow in the form of investment returns. ● Pay Larger EMIs It’s recommended that you buy a home when you’re still young because you’ll have fewer obligations at that time of your life. Now is the moment when you can afford to make larger EMI payments on your house loan because you are financially stable and everything is running smoothly. The debt will be paid off sooner than usual, relieving some of the pressure. The interest you’d otherwise pay can be avoided with this method as well. You should prioritize paying off your obligations, regardless of your age. It’s better to put that extra cash toward your EMI than to waste it on frivolous purchases. ● Pay a Bigger Down Payment Now is the time to cash in on any investments or savings accounts that aren’t generating significant income. Your home loan probably won’t cover the entire cost of the house. A down payment is an upfront cost that you must cover. You should expect to put down between 20% and 30% of the home’s purchase price. It’s preferable to put down larger sums of money for the initial purchase price if at all possible. If you pay a larger sum upfront, you may be able to lower your EMI payment. An additional risk is that this may shorten the length of your employment. You can benefit from both a low EMI and a short loan term because they both help you save money and lighten your financial load. This will allow you to pay off your debt sooner and save money on interest. ● Transfer Balance for Lower Interest Rates Multiple rate reductions are made by lenders due to varied interest rate reset periods. Alternatively, you might have gone with a house loan that had a high interest rate before learning that other banks offered the same credit at a cheaper rate. Selecting the banks that offer the lowest interest rates will help you save a significant amount of money. Banks’ “Balance Transfer Schemes” can also help with this. To qualify for a cheaper interest rate on a loan, you might use a practice known as “balance transfer” to move the loan’s principal balance to a new lender. Keep in mind that some banks impose fees for transferring a loan amount, so don’t do it just to get a slightly lower interest rate. You should make sure the money you save justifies the cost of the balance transfer fees. When transferring a balance, you’ll need to fill out all of the necessary paperwork and go through the loan underwriting and appraisal processes from the beginning again. ● Go for Partial Prepayment The interest you pay on a loan increases the time it takes to pay it off. Loan tenure and payments can be reduced quickly with partial prepayment as it has several benefits. To begin with, there is typically no fee associated with using the facility, and the minimum prepayment amount is often only Rs 10,000. One-time incomes such as a large bonus, large gains on stocks and shares, income from the sale of property, income from any maturing tax-saving investments or fixed deposits, gifts from parents or family, rental income, and so on, can be used to prepay a loan in part. ● Money management Your ability to keep track of your money is more crucial than ever now that you have a home loan (and possibly other loans) to repay. Learning to handle your finances is a crucial step in this direction. You can’t keep making financial mistakes and then blaming them on other people, circumstances, and so forth. Have no fear! You can rely on us to show you the way. Start by compiling a list of all your financial holdings. You should include your employees’ retirement account (ERA), postal savings account (PSA), postal deposits (PDs), and unit investment in insurance policies (ULIPs). You must have a plan for your financial resources. You should terminate any investments that are costing you unnecessary interest and put the money toward paying down your home loan. [B-02] Summing-up You’ll need to be a financial whiz if you want to pay off your loan without making any mistakes. Borrow only what you know you can afford to repay and work hard to pay off your loan and other debts as soon as possible. Your other major financial goals should not have to take a back seat if you use your own money to buy a house. You should have enough cash left over after making the down payment. Visit, Piramal Finance to improve your finance skills as they have many articles and blogs to improve your finance skills.
08-11-2023
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GST

GST Benefits and List of Taxes Replaced by GST

Paying taxes to the government is every citizen’s duty. Because of taxation, the government can generate enough revenue to fund infrastructure, education, healthcare, scientific development, defence, and many welfare schemes. The taxes paid by the citizens come back to them in the form of better facilities. Out of all the taxes that the Government of India levies on its citizens, GST, or the Goods and Services Tax, is a crucial one. The government introduced GST on 1 July 2017, as a form of indirect tax on all types of goods and services. The tax replaced all other existing taxes levied by both the Central Government and the state governments. [B-01] What Is GST And Why Was It Implemented? As mentioned earlier, GST is a form of indirect tax that the government levies on all the goods and services sold for domestic purposes. The tax amount is added to the total price of the product or the service. Out of many GST benefits, the most crucial is that it makes Indian products competitive in both domestic and global markets. However, petroleum products, alcoholic beverages, and electricity are not taxed under GST; instead, they are taxed by individual state governments. GST is divided into five tax slabs: 0%, 5%, 12%, 18% and 28%. There are four types of GST collected by different governments: IGST for the integrated tax levied by both the centre and state collectively, CGST levied only by Central Government, SGST levied by state governments, and UTGST levied by the governments of the union territories. List of Taxes Replaced by GST In India, GST has replaced the following taxes: Central Excise Duty Central Sales Tax and Service Tax Additional duties of customs and excise Excise duty on textiles and textile industries Value Added Tax Central Sales Tax, Entry Tax, and Purchase Tax Surcharge and CESS Taxes on advertisements, lottery, etc. Features of GST Some of the features of GST are Applicable Only to the SupplyUnlike other types of taxes that apply to production units, GST only applies to the supply of goods and services. Based on LocationGST works as location-based consumption taxation, not as origin-based taxation. Multiple Tax RatesGST allows for a range of tax rates like 0%, 5%, 12%, 18%, and 28%. A fixed list dictates that each product is to be charged with a different tax rate according to the tax slab. GST Composition SchemeSmall businesses from certain states that have an annual turnover of ₹75 lacs or ₹1 cr are eligible to apply for the GST Composition Scheme. According to this scheme, the firms only pay 1% of their yearly turnover as GST. Input Tax Credit SystemThe Input Tax Credit System is also one of the most vital features of GST. It implies that if a manufacturer or a service provider has already paid the input tax, that amount can be subtracted from the total tax liability. Benefits of GST You can also a range of benefits of GST registration, like Common MarketOne of the main advantages of GST is that it creates a common market for all goods and services. It also boosts foreign investment and makes domestic markets more competitive. Easy to AdministerAnother GST benefit is that it helps the government to easily administer all the indirect taxes on goods and services. As GST is backed up with a huge, end-to-end IT system, it becomes easier for the government to keep an eye on all the taxes. Improved ComplianceGST promotes compliance as all the returns are filed, all the input credits are verified, and all registrations are made online. Since everything is carried out online, it helps in keeping the taxpayers accountable. Uniformity of TaxesEarlier, there used to be many indirect taxes like excise duties and VAT. But after the advent of GST, the tax rates on all goods and services have become uniform across the country, so the whole system works smoothly. Prevention of Tax CascadingSince GST replaces all types of indirect taxes on products and services, no hidden costs are charged to the customer. This prevents tax cascading in the country. High Levels of TransparencyAnother GST benefit is that there is no opacity in how the tax system functions. As a single, unified tax is charged uniformly on all goods and services, there is utmost transparency in the whole process. Increased Competition:Removal of transaction costs and all other types of unseen costs improves competitiveness in trade, commerce, and production. Earlier, the provision of inter-state check posts added additional taxes on all goods and services. Now, since everything is boiled down to a single system, the extra costs have decreased, hence promoting competitiveness. [B-02] Conclusion GST is a unified tax system levied on all goods and services and has replaced many forms of indirect taxes. It reduces cascading of taxes, increases the transparency of the system, brings uniformity in revenue generation, and promotes tax compliance. However, along with GST benefits, the tax system also has some downsides like loss of fiscal autonomy of the states, no cross utilisation of tax, loss of revenue for manufacturers, etc. But the advantages of GST far outweigh its benefits. If this article helped you and made you more curious about GST, tax planning, different tax saving schemes, mutual funds, loan systems, etc., you can visit Piramal Finance. With the financial products and services of Piramal Finance, you can find the answers to your fiscal problems.
08-11-2023
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Other

Features And Benefits Of Good Credit Score You Need To Know

A three-digit figure, known as a good credit score, is used to reflect your suitability to get a loan or credit card. Credit scores range from 300 to 900, with 900 being the max score. When you request a property against loan, the bank or NBFC will check your credit score. TransUnion CIBIL, one of the four credit bureaus in India, provides this score. This score is based on a number of factors. Read on to learn more. [B-01] When it comes to credit, what factors determine a person’s score? As TransUnion CIBIL, the chance of getting a loan rises as your credit score gets closer to 900. A good credit score is regarded as 750 or more in most situations. How to improve your credit score? Listed below are five strategies that might help you improve your credit score. Options for Raising Your Credit Score You may think of your good credit score as a number in your credit report. Your credit score is based on various factors, including your payment history, credit mix, credit utilisation ratio, length of credit history, and more. Keep a clean track record by making full and on-time EMI payments for all credit cards and loans. Your credit score will take a hit if you make payments late or don’t make them at all. Repaying a loan on time over a long time shows lenders that you can be trusted with your money, which improves your credit score. Keep your ratio of borrowed funds to available funds low. The “utilisation rate” of a credit limit refers to the amount of that credit limit that has been used. The fact that you rely so much on credit indicates financial issues. Keeping your credit utilisation at or below 30 per cent will help with a good credit score. It suggests that you are less reliant on credit, have a lower burden for your EMIs, and are more reliable. Conduct routine checks of your credit report Any issues that arise need to be brought to the notice of CIBIL. They will resolve them by using the most suitable option for resolving the issue. Hence, the rating assigned to your credit profile may improve. Don’t Contact Many Lenders at Once If you’re looking for any loan such as a property against loan, only contact one lender. If you contact many lenders together, it makes you look like a credit-hungry person. This increases the number of hard queries on your credit report, both of which harm your credit score. Increase in Credit Limit If you want to have a good credit score, ask your credit card company for a higher credit limit. If you keep spending the same, having a higher credit limit will help you have a lower credit utilisation ratio. Inquire about a credit line increase by calling the provider. You should only consolidate debt if necessary. Always try to settle your bills fully before applying for a loan. Paying off your debts can lower your overall debt, and make you eligible for more loans if you need them. Why is it beneficial to have a high credit rating? Paying off debts, such as property against loan and credit cards, on time is one of the best ways to raise your credit score. Here is a list of some of the benefits that you can get as a direct result of having a good credit score – All borrowing rates are quite low. Having a good credit score has this major benefit. Everyone desires to have a great credit score to access low-interest options. The burden of debt can be reduced and paid off much more quickly as a result. In the long run, savings can be achieved by reducing major debts. Opportunities to obtain financing and credit cards are enhanced. Each lender checks your credit history and score when you apply for a property against loan or credit card. This is a “hard inquiry,” which might lower your credit score. Rejection of your application may harm your credit rating. However, if your credit score is high, creditors have less of a reason to reject your credit application. Thus, increasing the chances that you will be approved. Credit Limit Increases When applying for a credit card or loan, your income and good credit score are the two most important factors. So, you may get a bigger loan or a greater credit card limit. By examining your credit history and income stability, lenders can decide to determine if you are a reliable borrower. You could still be able to get a loan or a credit card even if you have a low credit score, but the terms will not be favourable. Influence in negotiations is increased Property against loan approval with higher interest rates is more likely for those with lower credit scores. These loans may have extremely tough repayment terms. Your ability to negotiate a better deal on the interest rate will be weakened. However, you will have a greater chance of having loans and credit cards approved if your credit is in excellent standing. You will also be able to compare loan offers and bargain for lower interest rates from lenders. [B-02] Conclusion With time, your credit score may increase or remain the same. An established track record of responsible monetary behaviour is the only requirement to qualify for credit. If you do this, you will be able to build your credit history and reap the benefits of being a responsible borrower, such as lower interest rates, more favourable loan terms, and other benefits. Learn more about a good credit score through blogs and articles on Piramal Finance.
08-11-2023
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