Canara Bank Business Loans

Are you stressed about setting-up or expanding your business? Worry not! Canara Bank Business Loans are here. You can now easily scale-up your business to new heights with Canara Bank business loans, as the bank offers tailor-made loans with competitive interest rates. It provides loans such as working capital finance, term loans, loans for infrastructure, and export finance. Here we are to make you understand these loans in detail and analyze which category your business fits into. 

Interest Rate and Other Charges

• Interest Rate: 10.50% - 18%

• Processing Fee: up to 1% of the loan amount

Types of Canara Bank Business Loans

Working Capital Finance

• Provided to invest in current assets like raw materials, semi-finished goods, finished goods, stores, sundry debtors, etc.

• It represents the money that is required for the stocking/purchase of raw materials or payment of salaries, wages, power charges, etc., and also for financing the period between the supply of goods and receipt of payment.

• Extended in different forms based on the requirement in the form of finance against receivables (post-sales), inventory limits (pre-sales), non-fund based limits, and short term lending products.

• Working capital requirements would be assessed by adopting various methods, such as the Maximum Permissible Bank Finance (MPBF) system, turnover method, net owned funds system, and cash budget system, depending on the type of activity.

• The securities would be as per the general lending standards of the bank and also depends on the risk perception of the individual account.

• Rate of interest on working capital finance depends on the nature of the activity, quantum of loan, purpose of the loan, risk rating, financials, etc.

Term Loans

• A term loan is usually extended for the acquisition of land, buildings, machinery, vehicles, etc. 

• Offered both for industrial and non-industrial borrowers, i.e., for projects/activities that are involved in manufacturing/processing/repairing of business or trading activities. The project needs to be established with technical feasibility and economic viability.

• Extended in different forms, such as all rupee and foreign currency loans, Deferred Payment Guarantees (DPG), and acceptance facilities.

• The repayment schedule is stipulated based on the debt service coverage ratio, cash generation, and repayment capacity. Repayment would be in periodic installments, with appropriate repayment holiday during the implementation of the project.

• The rate of interest depends upon various factors, such as the nature of the project, risk rating, quantum of loan, repayment period, and structure of the debt.

• Securities would be as per general lending criteria of the banks.

Other Documents Required for Term Loans

• Project Report; It must contain the following:   

  • Background of promoters, market survey, details on product choice, etc.

  • Information on infrastructural needs

  • Information technology

  • Details of input and availability

  • Projection of finances, production, sales, etc.

    • Copies of all licenses and permits.

    • Projected cash and fund flow statement covering the repayment period

Infrastructure Financing

• Extends finance to various infrastructure projects that are characterized by a large outlay of funds and longer repayment periods.

• The project must establish technical feasibility and economic viability. Also, sensitivity analysis will be conducted to make sure that the project establishes its viability.

• Finance is generally considered under consortium arrangement, considering the huge outlay of funds.

• The bank also provides syndication services to assist the promoters. 

• Rate of interest, repayment period, and security for infrastructure financing depend on the nature of the project, quantum of loan, cash generation, repayment duration, repayment capacity, etc.

Export Finance

Export Finance facilities are offered to units that undertake or desire to undertake export business.

• Pre-shipment Finance

  • Clean Packing Credit (CPC)

  • Packing Credit (PC)

  • Pre-shipment Credit in Foreign Currency (PCFC)

• Post-shipment Finance

  • FBE

  • FDB

  • BRD

• Foreign Bank Guarantee (FBG)

• Foreign Letters of Credit (FLC)

How to Apply for Canara Bank Business Loan

You can apply for Canara Bank Business Loans easily by following the method given below.

Apply for Canara Bank Business Loan Through a Branch

• Reach out to a nearby Canara Bank branch.

• Get the details regarding business loans and select the type of loan you require.

• Ask a bank executive for the application form.

• Fill in the personal and business details.

• Submit the form along with the documents required for the loan and wait for the approval.

Documents Required for Canara Bank Business Loans

• KYC of Applicant and Co-Applicant

  • Individuals: latest passport size photograph (duly signed by applicant & all co-applicants) 

    • ID proof: Aadhar card, copy of PAN card/driving license/passport. 

    • Signature proof: A clear copy of PAN card/bankers verification/passport/driving license.

    • Address proof: Aadhar card, valid rent agreement/latest postpaid telephone bill or electricity bill.

  • Partnership Firm 

    • ID proof of firm: Firm PAN card ( PAN card or PAN card issuing letter)

    • Office address proof: Latest postpaid telephone bill (mandatory) and electricity bill/valid rent agreement.

    • Partnership deed and registration certificate.

  • Pvt.Ltd. & Public Ltd. Companies

    • Company ID proof: A copy of the company’s PAN card. 

    • Address proof: Latest postpaid telephone bill and electricity bill/valid rent agreement. 

    • Business proof:

      • MOA & AOA

      • Business commencement certificate (for ltd. company)

      • Board resolution 

      • Shareholding pattern (C.A/C.S certified) 

      • ROC annual return

      • Incorporation certificate

      • Form no. 32. (if the director changes) 

      • DIN no. certificate 

      • List of directors on the company letterhead 

  • Note- GST/trade licence/sales tax no./service tax no./excise no./vat tax no., etc. (any one of the above taxation documents)

• Income Documents   

  • Proprietorship Firm & Partnership Firm:

    • CMA DATA & project report (if any)   

    • CA certified turnover certificate/GST return (YTD) 

    • Debtors & creditors certificate    

    • Acknowledgment copy of ITR applicant & all co-applicants (for the last 3 years)    

    • Form 16 a (TDS certificate), if applicable. 

    • Computation of income, balance sheet with all annexures, trading & profit & loss a/c

    • Annual audit report and tax audit report in case of an audited firm.        

    • Net worth certificates of the proprietor, all partners, and guarantors.

  • Pvt. Ltd. & Public Ltd. Companies:

    • CMA DATA & Project Report (if Any)

    • Latest 3 years acknowledgment copy of ITR (companies and all the     directors) 

    • Latest 3 years annual audit report and tax audit report with articles 3cb, 2d, and 3cd

    • Net Worth Certificates of Guarantors   

    • Form 16 a (TDS certificate), if applicable   

• Banking

  • Individual:

    • Major current account, cash credit account, and OD account statement (for the last 180 days) 

    • Loan statement & NOC documents: all running loan statements till date and the latest closed loan NOC

  • Partnership firm:   

    • Primary banking: latest major account, current account, CC account, and OD account statement (last 365 days).

    • Secondary banking: latest major savings account (applicant & all co-applicants) for the last 180 days

    • Loan statement & NOC documents: all running loan statements till date and the latest closed loan NOC    

  • Pvt. Ltd. & Public Ltd. Companies    

    • Primary banking: latest major account, CC account, OD account statement (last 365 days).    

    • Secondary banking: latest major savings account (applicant and all directors) for the last 180 days    

    • Loan statement & NOC: all running loan statements till date and the latest closed loan NOC. 

• Property Documents for Security   

  • Plant & machinery list    

  • Plant & machinery current valuation report    

  • Previous & current sales deed 

  • Margin money 

  • Previous property search & valuation report        

  • Property photographs    

• Other Business-Relevant Documents   

  • Corporate brochure    

  • Business profile of firm/company    

  • Profile of promoters/guarantors    

  • Business references 

  • Business experience supporting documents    

Canara Bank EMI Calculator

When you opt for a loan, it is very essential to know the EMI and the interest you are going to pay. Hence, for your convenience, Canara Bank provides you with an EMI calculator. Select the loan amount, repayment tenure (no. of months), and the rate of interest to get your EMI amount.

Track Your Loan Application Online

There is no need for you to visit the bank to know the status of your application. You can track your Canara bank loan status here. 

Interest Rates of Top Banks Offering Business Loans 

Bank	Interest Rate	Processing Fee
SBI	11.20% - 16.30%	2% to 3%
Axis Bank	15.50% - 24%	Up to 2%
HDFC	15.65% - 21.20%	Up to 2.5%
ICICI	12.90% - 16.65%	Up to 2%
Citibank	16% - 18.99%	Up to 2%
Yes Bank	16.25% - 19.99%	Up to 2%
PNB	12.65% - 16.65%	Up to 1.8%
IDBI	13%	1%
Kotak Bank	16% - 19.99%	Up to 2%
IndusInd	14%	Up to 2.5%
Andhra Bank	9.15% - 16%	1% to 3%
RBL	20% onwards	Up to 3%
Canara Bank	10.50% - 18%	Up to 1%
Bank of Baroda	14.10%	Up to 1%

FAQs

How much loan amount can I avail as Canara Bank Business Loans?

You can avail an amount between Rs.1 lakh and 3 crores.

What is the interest rate on a Canara Bank Business Loan?

The interest rate ranges between 10.50% - 18%. However, the rate of interest depends on the nature of the activity, quantum and purpose of the loan, risk rating, financials, etc.

How can I repay my Canara Bank Business Loan?

You can repay the loan through EMIs, ECS, and as auto-debit from your Canara Bank account. 

What security should I give to avail a Canara Bank Business Loan?

The security is totally based on the type of loan you take. You can get both secured and unsecured loans at Canara Bank.

What is the loan processing fee for Canara Bank Business Loans?

The processing fee for Canara Bank business loans is up to 1% of the loan amount.