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What is gratuity and how to calculate it online?

When an employee has worked for a private company for at least five years and received EPF benefits, the company is required to give the employee a gratuity. If a worker gets hurt or sick and can’t work because of it, they can get their gratuity before five years are up. You can use the site’s gratuity calculator online to see how much money your employer should be paying you for free. The Payment of Gratuity Act of 1972 governs the distribution of all gratuities. The final sum is determined by the employee’s years of service and their last drawn salary. [B-01] What do you mean by gratuity? The term “gratuity” refers to the lump sum payment that the corporation makes to the employee. It’s an expression of appreciation for the employee’s contributions to the business. The purpose of severance pay is to help employees out in their later years of work by providing retirement benefits. The procedures for receiving and disbursing gratuities are laid out in the Payment of Gratuity Act of 1972. An employee must meet certain requirements under this Act before receiving a gratuity. The person must have worked continuously for the company for at least five years. The worker can’t be employed by anyone else on a full-time basis. A gratuity may be paid to an employee before the end of the fifth year of employment if the individual has become disabled or has died. The maximum labour value of the bonus is 10 lakh Indian rupees. When determining a gratuity, the number of months of employment is a key factor. If an employee puts in more than six months during their last year, their total hours are rounded up. If an employee has been with the company for 15 years and 7 months, they will have 16 years of service. If an employee works for only 15 years and 5 months, however, that will count as 15 years of service. The rules for gratuity calculation are laid out in the Payment of Gratuity Act of 1972. These guidelines establish a dichotomy between the two types of workers. Employees who fall under the Act’s purview and those who do not are the two groups in question. Moreover, the Act specifies the kinds of entities that are subject to its jurisdiction. What are the requirements for receiving a gratuity? The following are the requirements to qualify for the bonus: You must be qualified to receive superannuation benefits. It was time for you to call it quits and retire. When your five years of service to the company are up, you are supposed to leave. Your beneficiary will get the gratuity if you die, and you will get it if you get sick or hurt and become unable to work. The benefits of using an online gratuity calculator An online gratuity calculator has the following advantages and is very simple to use: The document spells out exactly how much your employer has to give you as a tip. Simply input your current salary and length of service to get started. The calculator will then display the total amount of gratuity based on these two parameters alone. To avoid having to remember and apply the complicated Gratuity Calculation Formula 2022, use the Gratuity Calculator online instead. Automatically calculate the tip based on the provided formula and view the result right away. You can use the gratuity calculator to plan financially if you expect to be in your position for a long time. How does the gratuity calculation formula work? Employers who are covered by the Gratuity Act must give their workers tips based on the following formula: nb15/26 is the gratuity. Where n is the length of employment with the company and b is the last drawn basic wage plus dearness allowance For instance, you have spent 15 years working for the ABC company. Your most recent basic pay was Rs. 30,000 plus dearness allowance. Hence: The gratuity is calculated as follows: Rs. 2,59,615 (15 30,000 15/26). Here, two things should be mentioned: The Gratuity Act states that a gratuity cannot exceed Rs 20 lakh. Excessive amounts would be penalized. The number of years you worked in your most recent year of employment will be reduced to the nearest whole number if it is greater than six months. If your length of service is 16 years and 7 months, you would receive a 17-year gratuity. Otherwise, if it is 16 years and 4 months, it is for 16 years. If an employer is not covered by the Gratuity Act, the amount of a worker’s gratuity would be based on the half-month wage for each year of service. The formula is (15 your most recent income years worked) / 30. For instance, your base pay is Rs. 30,000. You’ve worked for the same company for 7 years straight, and the Gratuity Act doesn’t protect the company. (15 30,000 7) / 30 = Rs. 1,000,000 is the gratuity amount. [B-02] The Bottom Line A “gratuity” is money given to an employee when they leave their job for any reason other than retirement. Gratuities are not given to all employees. The Payment of Gratuity Act of 1972 sets some rules for how the gratuity amount should be given out. Gratuities are only available after five years of service. If a worker gets hurt in an accident or gets sick and can’t work anymore, they may be eligible for a gratuity payment before they’ve worked for the required five years. The size of your gratuity will be based on your last salary and the number of years you worked for the company. Contact Piramal Finance for assistance in calculating the gratuity. To read more such informative articles, visit https://www.piramalfinance.com/ right now!

08-11-2023

Other

All you need to know what is margin calculator and how it works

It is considered important to understand the uses of a margin calculator and how to use the tool to determine the margin needed for trading goods, stocks and equities, and conducting business in general. When you need to verify how much money you can make from a financial equation, a margin calculator can be a helpful tool to assist you in this process. When trading stocks, F & O, commodities and currency in India, a margin calculator is a tool that enables you to determine the full margin requirements for writing or multi-leg F&O strategies. [B-01] What Is Margin? In various situations, the word margin can have several different meanings. Margin can have a variety of definitions in financial terminology including: The difference between a product’s asking price and its production costs. The ratio between a company’s revenue and expenses. The amount of equity a shareholder contributes is a proportion of the market value of the securities they hold in a margin account. A portion of the interest rate on a mortgage with an adjustable rate is added to the index rate. Different Types of Margin Calculators and How They are Used To understand the different types of margin calculators and what they are used for, they can be divided into three subheadings to make it easier to understand: Profit Margin Calculator The profit margin, typically expressed in percentage terms, is the margin by which a business’s sales revenue exceeds its costs. Additionally, it can be expressed as net profit or net income divided by sales. A margin calculator allows you to measure productivity and the financial health of the company. A margin calculator can be used to assess your performance compared to your competitor and pinpoint areas that need work. An example of what a profit margin calculator will take into consideration includes: Cost: the item’s price Sales Revenue: the money that is made by selling the item Gross margin: the product’s percentage of gross profit as a percentage of sales Gross Profit: the sum of the product’s gross profit Mark up: the margin between the cost and the profit Stock Trading Margin Calculator The stock trading margin usually uses borrowed funds from brokers to trade financial assets. Buying stocks using borrowed money is known as “trading on margin”. Profits and losses tend to be amplified much more easily in this form of trading. The necessary sum for investors to buy assets on margin will be determined with the help of the stock trading margin calculator. These are the factors considered by a stock trading margin calculator: Stock price: the stock price is the cost per share Number of Shares: the number of shares indicates the total number that you intend to buy Margin Requirement: the percentage that the broker requires for the margin purchase is known as the “margin requirement” Amount Required: the minimum amount of money that you need in your account to make the purchase Currency Exchange Margin Calculator You can use a currency exchange margin calculator to estimate how much capital you’ll need as a broker or investor to engage in forex trading. Since currency trading depends on the exchange rates of many nations, this calculator analyses that data to estimate the sum required to turn a profit. Exchange Rate: the rate you want to buy the currency. The price will be what is being offered in your country of residence. For instance, suppose you want to buy 10 USD but only have EUR in your wallet. If 1 USD is worth 1.22 EUR on the currency exchange market, then the exchange rate is 1.22. Margin Ratio: the appropriate margin ratio. Units: The number of currency units to be purchased. The amount required: The amount of money needed to purchase or trade in your country’s currency. How Does a Margin Calculator Help? Here are a few situations where using a margin calculator would be beneficial: To figure out how much margin is needed for trading. To determine the trade’s available leverage. To figure out how multi-leg strategy margins benefit. It can also be used to examine the index’s permitted strike prices. What Is a Margin Calculator Used For? The use of a margin calculator makes determining the necessary margins and the leverage available for trades in all segments easier. It can also be used to track contracts that are still within the ban period, verify the permitted strike prices for index F&O contracts, and calculate the margin benefit for multi-leg F&O strategies across segments. The simplest method of using a margin calculator is to thoroughly study each term before inputting the necessary data. Each of the above-discussed calculators contains fields that must be filled in for you to find the information necessary, or in your case, the amount necessary for trading. [B-02] Conclusion The majority of the time, margin calculators are utilized for trading. It is usually advised to use a margin calculator before making a financial investment. Additionally, these calculators help you estimate your financial needs in advance so that you know the precise requirements. To read more, visit the Piramal Finance website and explore their products and services.

08-11-2023

Personal Loan

Where Can You Get a Personal Loan Easily And How?

Banks and other financial institutions give personal loans. It is important to choose the best among them. At times, getting a personal loan can be too hard. But the right knowledge on where and how to get a personal loan will make your job easier. This article will show you where and how to easily obtain a personal loan. [B-01] What Exactly is a Personal Loan? A personal loan is an amount borrowed by an individual from banks or other Non-Banking Financial Companies (NBFCs). You will pay interest until the loan’s repayment period is over. There is no need to provide security or collateral when applying for a personal loan. You can use the principal amount from a personal loan for any purpose, unlike an educational loan. Thus, personal loans are for personal purposes. Where and How Can You Get a Personal Loan? Personal loans are provided by a variety of lenders. They include banks, Non-Banking Financial Institutions (NBFCs), Credit Unions, and personal loan apps. Almost all lenders will see some basic eligibility from your side. You can get your loan easily by fulfilling the following eligibility. They affect your loan to a larger extent. Eligibilities for a Personal Loan Employment status and salary This is the first eligibility to get a personal loan. The lenders will find it difficult to provide loans for an unemployed person because of their inability to repay the loan. You should be a salaried or self-employed individual to avail of a personal loan. Age This is to fix the principal amount. The age range for eligibility is 21 to 60. This is different for different lenders. The higher your age, the lower your chance of getting a personal loan. This is because of the number of working years before retirement. Sometimes, if you are older than 60, you may have to submit collateral or security. Experience This is one of the important factors for a personal loan. Years of experience and working in the same industry will be a great advantage. Credit (CIBIL) score CIBIL score is the most important factor for a personal loan. It is a three-digit number that shows your credit history. The score ranges from 300 to 900. It is always advised to have more than 700 for a personal loan. If your credit score is low, don’t panic. It is possible to improve your CIBIL score. You can check your credit (CIBIL) score online before planning for a personal loan. Checking credit scores is completely free of charge. Financial discipline The lenders will consider your past repayment history for a personal loan. This will make your profile low-risk. They will also consider timely repayment of EMIs and interest. Smooth relationship with the lender Transactions or a good financial track record with the lending institution can have an impact. This will improve your chances of getting a personal loan. This will increase the trust of lenders. This may also determine the interest rate for your loan because lenders won’t be as stringent in this case. Present market conditions and the government’s steps The market conditions and the government’s steps directly influence the interest rate. It includes inflation, recession, etc. Inflation is the general rise in prices. The higher the inflation, the higher the interest rate. A recession is a period of decline in economic activity. Interest rates will be lower during the recession. The reputation of your organization If you are a salaried individual, the reputation of your organization matters. Working for a reputable company will increase your chances of obtaining a personal loan. Benefits of Getting a Personal Loan from Piramal Finance Least Documentation: Piramal Finance will ask you for only a few documents. This will save you time and reduce your burden. The documents required are: Identity Proof: Passport, Driving License, Aadhaar, Voter’s Identity Card Address Proof: Registered Leave and Lease Agreement, Passport, Driving License, etc. Income Proof: Salary Slips, Bank Statements, etc. Checking the required documents will avoid the last-minute rush. You may bring only one document per proof. Principal Amount: The principal amount for a personal loan from us ranges even from Rs.1 Lakh. Quick Sanction: We will sanction your loan and disburse funds more quickly. Low EMI: We charge lower interest rates for personal loans. It will also be decided based on your ability and creditworthiness. This helps with easy cash management. Flexible Repayment Period: The repayment method for personal loans is flexible. You can choose any method (fixed type, floating type, or hybrid type). There is an option for pre-closure and pre-payments. It lasts from 12 months to 60 months. Zero Prepayment and Foreclosure Charges: If you have a large amount, you can pay off the loan before the period ends. We’ll not charge extra for preclosing the personal loan. And there will be no pre-payment charges. [B-02] The Bottom Line We hope you understand the easy way to get personal loans. Personal loans are currently inundating the financial markets. It may seem easier to get a personal loan. But it is important to approach a trustworthy lender like Piramal Finance. Piramal Finance has a team of friendly and knowledgeable financial experts. They will guide you through the entire process. Contact us if you want to take out a personal loan with no prepayment or foreclosure penalties. You can visit Piramal Finance to read more articles like this.

08-11-2023

Home Loan

Things To Take Care of While Applying For a Loan Against Property

A loan against property is a secured loan that is offered against property, whether the property is residential, commercial or industrial. Until the entire sum of the loan secured is repaid, the lender continues to hold the property as collateral. Loans secured by property are typically available from banks or other financial organisations at substantially lower interest rates than unsecured loans. If you considering applying for a loan against property, this article covers the loan against property eligibility requirements and other important aspects such as the loan against property interest rates and more. [B-01] Loan Against Property Eligibility Requirements These are the loan against property eligibility requirements for those who are salaried and self-employed that you will have to carefully go through before you apply for a loan: RequirementsSalariedSelf-EmployedAgeBetween 21 and 60 yearsBetween 25 and 65 yearsWork ExperienceA salaried individual working in an MNC, the private sector, or the public sectorA self-employed individual with a regular source of incomeResidentA resident of IndiaA resident of IndiaCIBIL Score750+750+Documents RequiredIdentity proof documentsAddress proof documentsLast 2 years’ income tax returnsKYC documents.Form 16Last 6 months’ bank statements and salary slipsDocuments for the property given as collateralIdentity proof documentsAddress proof documentsLast 2 years’ income tax returnsKYC documents.Form 16Last 6 months’ bank statements and salary slipsDocuments for the property given as collateral Loan Against Property Interest Rates The loan against property interest rates vary from one lender to another. Mostly the interest rates range between 8% to 25%. Before applying for a loan against property, it is important to research multiple lenders since each will have different interest rates. Once you have decided on a lender, double-check the interest rate since this will have a direct impact on your EMIs. 8 Things To Consider When Applying for a Loan Against Property If you have decided to apply for a loan against property, here are 8 important things to consider before you make your application: 1. Determine the Value of the Property As the name implies, a loan against property is given against property (either residential or commercial), which the lender retains as collateral. The evaluation of this property will determine the loan amount you are qualified for. Depending on the property’s size, age, location, features, etc., its value may change. Banks issue a loan amount between 60% and 80% of the property’s market value after considering all the criteria. As a result, to qualify for the loan amount for which the property is pledged, a borrower must be aware of the property’s value. 2. Examine Your CIBIL Score A CIBIL score is a three-digit number representing your credit repayment history. It provides information to the lender regarding how promptly you have paid loan EMIs in the past. If your CIBIL score is 750 or higher, the bank is more likely to approve your loan against property application. Banks may, however, immediately reject a loan application that has a low credit score. 3. Obtain an Estimation of the Loan Amount You Require When it comes to a loan against property, lenders will provide you with up to 80% of the value of the property, but you must assess your actual need. Make a list of the expenses that you need money for so that you can get a loan against property for the exact amount that you require. 4. Compare Interest Rates of Different Lenders Do not rush to apply for a loan against property with the very first lender you come across. In addition, applying for a loan with a bank where you already have an account is not compulsory. Loan against property interest rates will determine what your EMIs will be. Therefore, always compare the loan against property interest rates of different lenders and choose the lender that offers the lowest interest rates. 5. Research the Lender’s Eligibility Criteria The loan against property eligibility criteria differs according to each lender. For instance, Lender A might make a loan against property available to anyone over 21 years old. Lender B, however, might only favour lending to people over the age of 25. Similarly, different lenders may have varying requirements regarding minimum income, documentation, work experience, etc. Therefore, be aware of the lender’s eligibility requirements to reduce the possibility of a loan being rejected. 6. Consider Your Loan Repayment Capacity Before applying for a loan against property, you must evaluate your ability to repay the loan. You can make a budget using all of your sources of income and outgoing costs to determine an expected instalment payment that will allow you to meet all of your financial obligations. You can calculate EMIs based on your preferred repayment schedules using online EMI calculators. 7. Repayment Tenure and EMIs The repayment tenure of a loan against property varies from 15 years to 30 years. Your EMIs will be more manageable if you choose a longer repayment period, but during this time you will be paying interest rates for a longer period. With a shorter term, you will have a lower interest rate, but your monthly EMI payments will be higher. Thus, choose a tenure that fits your ability to repay the loan. 8. Consider the Processing Fees and Other Charges When you submit a loan against property application to a lender and it gets accepted, the lender may charge you a processing fee that typically ranges from 1% to 4% of the loan amount plus GST. Aside from that, some banks may charge prepayment fees and even have stamp duty costs. You must find out about all of these additional charges to accurately assess the loan’s true cost and make an informed choice. [B-02] Conclusion A loan against property is a secured loan offered against collateral. Before applying for a loan, assess the value of the property that is going to be given as collateral and make sure that you meet all the loan against property eligibility requirements for instant loan approval. Always compare the loan against property interest rates of different lenders and choose the one that offers you the lowest interest rate. It is also important to keep track of all your sources of income and expenses and then decide the loan amount you want to borrow. By considering all these important points, you can make sure your EMIs are manageable and that you will be able to repay your loan on time and keep your property secure. Visit Piramal Finance for more information on how to apply for a loan against property.

08-11-2023

Business Loan

How business loan can grow your business with profit?

Especially after Covid-19, a lot of small business has started. Needless to say, you need not invest your money to start a business. Many financial institutions are available which will help you pursue your passion. Online business loans are readily available which you can avail from the comfort of your home. [B-01] Features of an Online Business Loans Gone are those days when you had to go to financial institutions, to apply for a business loan. You can just apply for it from any web portal of your choice. If you want to avail of an online business loan from Piramal Finance, make sure that you have a business history of four years. Business loans can be availed by anyone in the age range of 23 years to 65 years be it, self-employed professionals or entrepreneurs. With a flexible business loan interest rate starting at 17% per annum, claiming a collateral-free online business loan has never been easy. Stop worrying about the cash crunch and start following your dreams. Benefits of Online Business Loans With your money needs sorted, you can divert your attention towards other aspects of your business. As you expand your business, your profits will also increase. Reviving your business Sometimes, it so happens that you have incurred a loss in your business. Before you give up on your dream, taking a loan will help you to revive your business. The additional capital will set you on your onward journey and before you know it, you will be generating profit. Company’s website In this digital era, a website is a must to make your presence felt. The more people see your brand via a website or social media, the larger will be your customer base. No wonder, by sparing a small amount for setting up a website, you can get more sales by promoting your content. You can hire a customer representative for solving the queries. Marketing If you want to make a considerable profit, you need to spend some amount of money on promotions. There can be marketing through the distribution of pamphlets or in the form of advertisements on billboards. You can also give discounts and offers on special occasions to attract the crowd. You can also collaborate with social media influencers to attract their followers as well. Skilled workers You can hire skilled workers who will ensure that you get quality products at your desired time. You can also organize training so that they can learn to improve their skills. Superior quality ensures enhanced customer satisfaction. Investments You can use the loan to pay for new machinery which will ensure that your productivity increases. Machinery tends to be expensive. No doubt you can afford these using business loans and the quality of the product will increase. Timely payments It is crucial to make payments to your suppliers timely. In case you offend them; you will not be able to make your finished products. Searching for new suppliers is also a waste of time. It is important to have a good relationship with your existing suppliers. You need to pay your workforce on time too. Expand your business Have you ever wondered what it would be like to venture into a new branch of your business? For example, after running a successful business in soap making, you would like to start making candles during the festive seasons. Don’t be worried because of the cash crunch, you can pursue your desire using the loan amount. If you have a successful run, congratulations on your achievement. Purchase in bulk Once you are sure of your business, you can invest and procure your materials in bulk. The bulk purchase ensures that you can get discounts on your materials. It ensures that you can make a profit just by acquiring the raw materials in bulk. Creditworthiness When you opt for business loans, it is usually an unsecured loan meaning no collateral is required. The interest rate is also low which ensures that you can repay your loan in time. Your CIBIL credit score will also increase which in turn enable you to take further loans. Tax benefit The tax deduction is done on the profit amount obtained from your business. You can avail of tax benefits according to the Income Tax Act of 1961. Why should you choose Piramal Finances for your online business loan? Piramal Finance offers you a business loan starting from Rs 3 lakhs to Rs 10 lakhs for 36 months. If you are someone who has been running a business for 4 years, you can click on apply for quick loan and request a callback. Do you know the best part, you need not go to the bank for application of the loan! The loan amount which you can utilise for the capital requirements, you get at an affordable interest rate. With minimal papers, you are good to go with a hassle-free quick disbursal loan and will be tension free for a tenure of four years. Concentrate on your craft and passion and stop worrying about your finances. [B-02] Conclusion Piramal Finance is your one-stop solution for all your financial needs. Please feel free to check out their various schemes. Do check their personal loan offers for a quick loan starting from 1 lakhs to 10 lakhs. The flexible interest rate starts from 12.9% per annum for a duration of 12 months to 6 months. With minimal documentation, you can avail of a loan of a higher amount if your working spouse is your co-applicant. What are you waiting for? Fill up the application and wait for a call-back from their relationship Manager. Your loan will get processed in record time and you can spend on whatever you desired.

08-11-2023

Business Loan

Reasons to Invest Your Business Loan in Advertising

Do you want your company to stand out among the others? You need to advertise your product or service and inform the potential customer how you are better than the other small businesses that may compete with you. Marketing is crucial for all businesses but vital for a start-up firm. Effective advertising for business can affect a business’s reputation and sales. Also, you can get a business loan if you need more money for advertising. Let’s read about business loans for advertising in detail. [B-01] What is a Business Loan; What Purpose Does it Serve? A business loan is a financial assistance that a lender provides to invest money and grow your business. It is one of the best ways to take your business venture to another level and increase its worth. In return, you need to pay a specific interest on the loan amount to the lender for a set period. Business loans are a secured form of loans. Keep your assets as collateral to get the debt from the banks. Banks ask for collateral to use as a guarantee till you repay the loan with interest. What are the Reasons to Invest Your Business Loan in Advertising Promotions Aimed Directly at a Specific Audience Micro, small, and medium-sized businesses can learn about their target customers’ wants and needs at a low cost with the use of social media and business networking sites like Google Analytics, Facebook, and LinkedIn. Companies can now focus their marketing efforts on a certain group of people or geographic areas where they believe they can reach the highest number of potential customers. Therefore, these solutions not only help to make targeted advertising for businesses more cost-effective, but they also guarantee that your business and its products and services receive the highest potential return on investment. For this reason, these resources provide a great return on business loans. Advertising on the Internet is Reasonable Print, radio, and television are the options for reaching consumers before the Internet and digital media. With the rise of pay-per-click models and other digital innovations, prices have dropped, and it has become easier to invest. Thanks to these models and resources like Google Adwords, you, as a digital marketer can effectively and affordably measure the effectiveness of your ads with business loans. Being Noticed in the Crowd As was previously discussed, good advertising makes your product more noticeable in the market. At a time when so many businesses compete for the same customers, effective advertising for business strategy is crucial for getting your brand noticed. Commonly, consumers give more importance to well-known companies in competitive markets. A high-quality new brand can survive on word of mouth for a short while and in a limited demographic and geographical domain. But, it is also essential that the business loans in advertising increase the brand’s reach and make the target audience aware of the existing product and service. Effective branding efforts further increase word of mouth, creating a snowball effect. Putting Money into Advertisements Pays Off There is a chance that it is a misconception that advertising costs a lot of money. It’s also a wise expenditure that may help a business to succeed by raising brand awareness. It also teaches potential customers about the benefits of the company’s products and services. Boosts Recognition of the Brand Well-established names in the industry tend to do better than newer ones in the eyes of the buying public. Although commitment is essential, it is possible to influence your customers’ perceptions through brand awareness. Now more than ever, you can reach your target audience and inform them about their products and services through contextual advertising across many platforms, including the web. It makes you more noticeable to your target audience and sets you apart from other competing firms. Affordability When it came to spreading information, print or other audiovisual media like TV, radio, etc., are no longer sufficient. But social media platforms like Instagram, Facebook, etc., allow you to advertise your business to a larger audience at a reasonable cost. Also, with the help of business loans for advertising, you won’t have to break the bank. How? Several banks provide business loans at low-interest rates to make loan repayment easy. Exceptional Return on Investment In recent years, the goal of advertising has expanded beyond simple brand awareness. Obtaining real-time analytics and developing targeted marketing to boost sales are some essential components. Paid and targeted initiatives to expand your social media footprint are far simpler to create and execute on networks like LinkedIn and Facebook. Business loans and some of your savings in marketing can yield significant returns. Building awareness One of the main reasons for business loans for advertising is that more people will learn about your business, brand, and products. Advertising your business helps business to reach out to new customers and prospects. Indeed, you won’t make any money if you can’t attract customers. Meanwhile, marketing helps spread the initiative and the service of your business. [B-02] Conclusion The purpose of this article is to give a comprehensive examination of the reasons why you should be choosing a Business Loan for Advertising. Whether an investment is the best choice for you or not, you should determine it on your own. Since advertising is an expense that you must consider, securing a business loan at a competitive interest rate from a reliable financial institution is equally important. Before investing, it is also crucial to be aware of other sides. Many institutions do not offer financial advice, but we provide unbiased information and evaluations on trading, investing, and finance. Users ought to always carry out their research. Also, visit Piramal Finance has more in-depth, educational, and financial articles.

08-11-2023

Business Loan

What Happens When Somebody Could not Pay Off a Business Loan?

As a small business owner, you know what it takes to build a company from the ground up. You may have encountered many difficulties while building your firm. Lack of operating cash is one of the major issues that most small company owners like you deal with. To run day-to-day company operations, money must come in. This is the reason why entrepreneurs like you decide to get a small business loan. These loans are offered to aid small business owners in establishing, growing, and expanding their enterprises. Many small business owners are concerned about defaulting on their loans. It is crucial to understand “what happens when you fail on a business loan.“ [B-01] What is a business loan? A business loan is a financial instrument. It generates funds and meets the company’s investment needs. The firm’s owner applies for a business loan from a bank. The amount of the loan and the interest rate are fixed. After accepting the loan, the borrower handles paying the lender the principal sum. You may repay using various options, including EMIs, part payments, lump-sum payments, etc. Why are business loans important for a company? Business loans have become one of the most popular leveraged financial solutions. It is for business owners wishing to invest in their companies without spending money. There are no limitations on the ultimate use of the loan amount collected. The loan amount provided by the loan for company may provide a slew of benefits to business owners. You may use the loan proceeds to buy goods, hardware, and real estate. Or, you may use the loan to invest in equipment and machines. As a result, a loan may meet all a company’s capital needs. Yet, some business owners fear that loans hinder their ability to buy equipment and machines. What Happens If I Don’t Repay a Business Loan? Even company owners with the best of intentions may quickly fall behind on repayments and ultimately fail on a small business loan. If you are wondering what will happen if you default on a business loan, look at the following points: The lender will make efforts to collect- A lender will attempt to collect the business loan through all communication methods, including letters, emails, and phone calls. The credit bureaus will be notified of the default- By default, both your personal and corporate credit ratings will be harmed. Since the documentation required to record an unusual, one-time late payment is not worth their effort, lenders seldom do so. However, they’ll notify the credit bureaus if you don’t pay after a few months. Personal Promises and Security- If you obtained a secured business loan, your lender would have the authority to take possession of the pledged collateral. Sometimes the equipment that serves as security is bought with a loan. Possible request for you to sign a confession of judgment- You give up the right to represent yourself in court when you sign a confession of judgement (COJ). The lender may have the ability to freeze your account and other assets once it has been notarised. Lenders are requesting that borrowers sign these letters in advance. Lending to a small company carries risk, especially if it’s an unsecured loan. Confessions of judgement protect the lender. In this letter, the parties anticipate their future course of action if the borrower fails. Steps to Repay a Business Loan You must have had a good reason for delaying your business loan payment for a while. Whatever the cause, if you’re having trouble making your payments, you may want to think about one of these numerous alternatives: Postpone Your Payments You might request an EMI vacation for a few months after informing the bank of your temporary incapacity to make payments. This circumstance may arise during a job move or a brief lack of clients or workers. Banks may recognise these as valid justifications but still, charge deferral fees. Lower your EMI Consider getting the monthly expense decreased if you are having trouble paying the EMI amount. You may speak with the lending company and ask them to extend your loan’s term. This will lower your monthly EMI payment, but you could end up paying more in interest. You should raise the EMI amount after your financial situation has stabilised. Loan Restructuring A borrower may ask the lender to reduce the loan’s terms and conditions if he or she cannot uphold them. This might result in fewer fees, a lower interest rate, a longer loan term, an interest-free period, etc. Single-event Settlement This option is often used whenever a borrower cannot repay a business loan because the interest accumulated is more than the principal. At this point, the lender would have designated the loan as a non-performing asset (NPA). The borrower may be insolvent or unable to make any further payments. He could be given the option to repay the debt with a minimal payment. Recently, a bank made a settlement offer to its non-performing assets (NPAs) in education loans, waiving up to 90% of the principal and 100% of the interest. However, if you accept this offer, proceed with care since it may impact your credit score, and your credit record will show that you could not repay your loan in full. [B-02] Conclusion Utilising a business loan might assist you in starting and growing your company. But it’s crucial to make your loan repayments on schedule. Failure to do so might have a negative impact. Before accepting the loan, inquire with the lender about how they handle late payments and what happens if you cannot make any payments. For more blogs on business loans, check out Piramal Finance and explore their products and services.

08-11-2023

Home Loan

All you need to know about loan against property interest rates and charges in India 2022

In India, many people like to invest in property. They believe that it can not only secure their money but also help them make a profit. With a gradual increase in property prices or rentals, people can earn a huge profit. However, there is one more way to put your idle property to use. This option helps you remain the property owner and meet your urgent needs for a huge amount of money. This option is a loan against property (LAP). Herein, you offer your land as a security to the lender and get a high-value loan at extremely low-interest rates. [B-01] When you give a property as a security, the risk reduces for the lender. In case of a default, there is a way for the lender to recover the money. This lower risk helps the lenders offer lower mortgage loan interest rates compared to other loans that do not require a security. You can use the money from the loan for your needs. Although, it is vital to note that other than the interest rate, lenders also levy various other charges for this loan. Hence, it would help if you learn about the interest rate and charges before taking a LAP. About Loan Against Property A loan against property (LAP) is a secured loan. Hence, loan against property interest rates is quite low compared to other types of loans. Lenders offer repayment periods of up to 20 years on this loan and can offer up to 80% of the asset’s value. Such high-value loans can help you take care of your needs. Also, the low-interest rate would mean lower EMIs. Hence, you can pay back without the loan taking a toll on your finances. If you pay your EMIs on time and need some more money in between, you can apply for a LAP top-up. Herein, the lender will create another charge on the property and offer you more money per your needs. The same mortgage loan interest rate will apply in this case as well. There is no limit on the type of purpose for which a LAP can be used. You may even use the money for your personal or work-related needs. Loan Against Property Interest Rates The interest rate plays a huge role in a LAP. Loan against property interest rates can start from as low as 11.5% per annum. This is much lower than other types of loans. Such a low property loan interest rate means that your EMI will also be lower. This makes it easier for you to repay the loan on time. There are many factors that lenders will consider while deciding on the mortgage loan interest rate. CIBIL score: If you want the lowest interest rate, your CIBIL score must be 750+. This score shows you as a responsible borrower. Hence, the lender will offer you a low-interest rate. Amount: Many lenders vary their interest rates based on the value of the loan. The higher the loan amount, the lower the interest rate can be, and vice-versa. But you must only borrow the amount that you need. Track Record: You can easily track your repayment records. Lenders want you to have a good track record in terms of repayments. You must pay all your credit card bills and EMIs on time to get the best interest rates. Type of Property: Property location and condition also impact interest rates. Property at a prime location with a clear title will certainly attract a lower interest rate than other property options. Profile: Your profile in terms of age, salary/income, and ex-work also impact the property loan interest rate. Loan Against Property Charges Lenders levy a range of charges against a LAP. Here are some of the common charges that you will have to bear to get this facility. Processing Fee: This is the fee a lender charges to process loan applications. All lenders levy this charge, but the percentage can vary from lender to lender. Some levy it as a ‘%’ of the loan amount, while others may levy it as a fixed cost. During the festive season, some lenders offer waivers of processing fees as well. Legal and Technical Charges: When you apply for a LAP, lenders need to verify the title of the property. For this, they hire a lawyer who will check all the papers as well as the location of the property. These charges must be paid at the time of application and are non-refundable. Foreclosure charges: Many lenders allow you the option to prepay your LAP if you have spare funds. But to avail of this facility, you need to pay charges which may go up to 4% of the balance loan amount. EMI dishonour charges: If you fail to pay the EMI by the due date, the lender will levy a dishonour charge against your account. The lender will also charge a late payment fee and penal interest until you pay the given amount. Account Statement: Most lenders allow you to download the account statement online free of charge. Most lenders also mail you this statement every month by email. But if you need a physical copy of the account statement, you must pay this fee to the lender. CERSAI Charges: As the asset in question is land, the lender will create a charge on the property through CERSAI. This would need you to pay around Rs. 500 as the registration fee for CERSAI. [B-02] If you want the best deal for your loan against property, you must select a good lender. With Piramal Finance, you get high loan amounts and low interest rates. This will make it easier for you to pay for any urgent expenses without taking up any other loan. You can also learn more about LAP and its key aspects through a range of blogs and articles on its website.

08-11-2023

Personal Loan

Important Things to Know before Pre-Closing a Personal Loan

For most people, a personal loan is the best way to get the money they need quickly. While this specialized credit is easily accessible to everyone with no paperwork, it typically comes with a high-interest rate. The high-interest rate might increase your total debt and drain your available credit. Paying off debt quickly is very helpful since it reduces the interest you have to pay, as any financial adviser or even a careful friend would tell you. This is especially true if the loan is a high-interest personal loan (interest rates typically range from 11–22% per year; borrowers with poor credit may pay as much as 26%). [B-01] A personal loan in the form of Equated Monthly Installments (EMIs) may have a longer repayment term of up to 5 years, sometimes even 7 years. However, paying off your mortgage early can greatly improve your credit score. Before you jump on the pre-closing bandwagon, however, it’s vital to understand the pros and cons of pre-closing a personal loan, as with any financial decision. Important Things to Know before Pre-Closing a Personal Loan Prepayment of a personal loan might reduce interest costs It is possible to reduce the total interest you owe the lender by paying off the loan before it matures. You get quicker and easier credit when you pre-close on a personal loan Borrowers seeking a Home Loan or other form of long-term finance should have a spotless credit history and low or no outstanding debt. Doing this can increase your borrowing capacity and secure low-interest rates on your new loan. By eliminating this debt, you’ll gain financial independence and the psychological benefits of a debt-free state of mind. Not to mention, it will increase morale! Your financial resources may run out if you pre-close on a personal loan You can pre-close your loan by paying the whole balance in one lump sum. Due to the huge total, you may have to pool your resources and spend your savings to pay for it. You could put the same money to better use in other, more productive ways. You should reconsider pre-closing the personal loan if you anticipate a bigger return on your investments than the interest you’ll save. However, you could put the same sum of money toward other goals, such as paying for a child’s college tuition or covering the costs of a family wedding. There may be fees for prepaying a personal loan Some lending institutions charge a prepayment penalty for paying off a personal loan, which can be up to 5 per cent of the principal money. This is because these lenders want to keep collecting money from your pocket so that you cannot get out of debt. Choose a loan provider that does not charge this unnecessary penalty. When Is the Right Time to Pre-Close a Personal Loan? Loan pre-payment terms are highly situational and vary greatly from borrower to borrower. This allows you to pick the period that works best for your budget. Why not pre-close the loan and eliminate the debt if you have enough money saved, got a rise, or received an unexpected bonus? How to Pre-Close Your Personal Loan? The term “pre-closure” means the full repayment of a loan before finishing the loan term. Some loan providers charge a fee if you want to close the loan early. Pre-closing can reduce your interest rate and overall loan load. You can get your personal loan closed early by following the steps below. It’s vital to find the potential savings before the pre-closing penalty and determine if proceeding with the process of pre-closing the personal loan is worth it. However, there is a general advantage to deciding to pre-close on a loan as early in the loan’s term as possible. The pre-closure fines, however, are the harshest during this time. The pre-closing policies and associated fees of various financial institutions vary widely. To settle your loan, you must go in person to the bank from whom you have taken the money. You’ll need to bring your valid photo identification, recent bank statements showing that your EMI was successfully withdrawn, your loan account number, and a check or money order to pay back the total loan balance. Lenders also assess prepayment penalties as a percentage of the loan balance, which you must pay in addition to the principal. If you pay your down payment in advance by check, cash, or DD, the bank will issue you a receipt that must be preserved for record-keeping purposes. A few days after the loan closes, the bank will send you the loan agreement if everything goes smoothly. What Is Part Prepayment of the Loan? Sometimes, you may receive a bonus or come across some unexpected money you’d like to use to pay down your loan. It’s possible that the sum won’t cover the entire loan. When this occurs, you can prepay a portion of the debt. Prepayment penalties will apply if only a portion of the debt is paid off early. Pay close attention to those. In addition, lenders may limit the total number of partial prepayments permitted. Verifying with your lender before making a prepayment is vital because these requirements may differ. Your loan account will not be terminated as a result of this. After making a partial prepayment on the loan, you may still have a few more due EMIs. [B-02] Conclusion In the case of personal loans, the borrower typically has no collateral to be released upon loan repayment. You mustn’t put off closing your personal loan. Instead, you should know how to close your loan properly for your credit’s sake. Need instant funds? Apply for a personal loan with Piramal Finance!

08-11-2023