written by khatabook | November 11, 2022

How to Get a Business Loan On an Aadhaar Card Online?

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Table of Content


In today’s economic scenario, every business needs capital in order to expand, grow and become sustainable. A business loan is a great way to fund your business to reach your growth potential. Businesses require money to conduct operations such as buying raw materials, paying operating expenses, hiring new employees, or expanding operations. However, big banks are cautious about giving out loans because of the risk involved. Hence, most banks require collateral from businesses that apply for a loan. 

For a small company or business, a short-term business loan can greatly help in times of crisis. Your Aadhaar card can help you get a loan instantly in times like this. In this article, we will discuss how to get a loan with an Aadhaar card, an Aadhaar card loan online, loans on an Aadhaar card and pan card, eligibility criteria, and more.

Did You Know? A ₹50,000 rupee personal loan is regarded as a small cash loan. For verification, a personal loan of ₹50,000 requires the same standard paperwork as other loans, such as an Aadhar card and a PAN card.

How Can Your Aadhaar Card Help You Get a Business Loan?

An Aadhaar card is an identification card issued by the UIDAI, i.e., the Unique Identification Authority of India. It is a 12-digit unique identification number issued to every Indian citizen based on their demographic and biometric information. 

Your name, photograph, biometric data like your fingerprint and iris` scan, address, and identification number are written on an Aadhaar card. It is valid for five years from the date of its issuance and is renewable. The Indian government has made it mandatory for all Indian citizens to get an Aadhaar card before the 31st of March 2019. The government is using the Aadhaar card to streamline the benefits and subsidies given by the government to its citizens.

The card details make the verification process faster and simpler. The lender checks your details to confirm the correct identity before approving the loan. Most banks and financial institutions prefer the Aadhaar data as a reference document when deciding upon loan applications. Nowadays, the Aadhaar card is linked with Permanent Account Number, mobile number, and bank account, making the application procedure simpler and using minimal paperwork.

Also Read: Top 5 Government Loan Schemes for Small Business in India

When Can you use Your Business Aadhaar Loan?

Loans should only be used for the purpose mentioned on the loan application. Generally, small short-term loans are necessary to tide over sudden emergencies like clearing debts or salary payments, or repairs. You can also use it for promoting your business, renovating, or creating a website. You can buy equipment for smoother operations of your company.

How to Get a Loan on an Aadhaar Card?

Pre-requisites to get a loan an Aadhaar card:

To get a loan with an Aadhaar card, you will need to fulfill the following steps:

  • Link both your business and personal bank account with your Aadhaar number
  • Link your mobile phone number with your Aadhaar number
  • Link with your PAN (Personal Account Number)
  • Although it is usually not required, linking your Aadhaar number with identity documents such as ration card, voter ID, LPG connection, etc., is suggested in case of the second line of reference checking.

Eligibility Criteria to get an Instant Loan on Aadhaar Card

The following criteria will make you eligible to avail of a loan application for an Aadhaar card:

  • The business must be more than a year old from the registration date.
  • The business’s monthly turnover should be at least ₹200,000/-
  • The individual must be aged between 21 to 65 years to avail of the loan
  • Sole proprietorship firms, small individual corporations, and private companies in trading, manufacturing, or providing services are eligible to apply for an Aadhaar business loan.

Must-Have Documents for a Loan From an Aadhaar Card

The documents required for a loan on an Aadhaar card are:

  • Personal and business PAN card
  • Bank statements of all business bank account for the last six months 
  • Aadhaar card
  • GST registration certificate
  • Photographs
  • Shop and Establishment certificate

Also Read: Types of Loan - What are different Types of Loan in India?

Features of Instant Loan on Aadhaar card

Tenure of the Loan

3 to 24 months

Loan amount

₹50,000 to One Crore

Rate of Interest

Depending on the loan tenure, your business profile, and eligibility; follows the standard market interest for the same kind of loan starting from 1.33% per month.

Repayment

Flexible options suitable for your business requirements

Processing charges

2% of the loan amount

Approval time

48 hours

Application procedure

Offline and Aadhaar card loan online application

How to Apply for an Instant Loan on an Aadhaar Card Online?

If you are looking to apply for a business loan but don’t have any security, you can use your Aadhaar card to get a business loan. You can upload a soft copy of your Aadhaar card and other documents supporting your business status and personal information.

  • Check your eligibility for a small business loan.
  • Complete the application procedure online
  • Submit the documents required on the loan granting website, and your application and credentials are evaluated.
  • You will receive an agreement from the lender if your loan is approved.
  • Once the agreement is completed, the money is transferred to your bank account.

Also Read: Business Loan For Shop Purhcase - Compelet Process, Benefits, Documenst Required

What Elements Influence Your Aadhaar Business Loan Application?

Loans on an Aadhaar card and all unsecured small business loans depend on the evaluation parameters of the lender, which is a financial institution or a bank. The lender's primary goal is to ensure that the loan money is safe. The lenders create a risk profile of the borrower individual or business entity for each loan application based on the submitted documents. The parameters which decide the approval of the business Aadhaar loan are-

  1. Financial Standing: The financial statements judge your business's status. The statements with sound accounting practices, consistent cash flows, and a considerate level of financial reserves are regarded before approving the loan.
  2. Utilization Plan: Lenders analyze your plan of utilizing a particular loan and apply the evaluation criteria to your company's finances. It is suggested to submit a utilization plan with the Aadhaar business application so that the lender can make a fast decision on your application.
  3. Loan Amount: You should apply for financial support in an extreme situational crisis. A high amount might be turned down as your proposal might need to be able to justify your purpose. You should match the fund requirements of the business, future cash flow estimates, and expected benefits with your loan amount request to be approved faster.
  4. Credit Score: India’s top credit information company’s CIBIL Score of 700 is perfect for availing of any loan. A low CIBIL score pushes up the interest rate. CIBIL score of less than 650 might not get your loan approved. 

Conclusion

Aadhaar card has become a deeply integrated digital identity that you can use to apply for a business loan and get one quickly. Using your Aadhaar card as collateral for a business loan can help you get a loan with minimal paperwork. If your business is new or if you run a small business, you can use your Aadhaar card to get a business loan by uploading a soft copy of your Aadhaar card and other essential documents online. Hopefully, now you are well informed about Aadhaar business loans, how to get a loan on an Aadhaar card, Aadhaar loan application, etc., via this article. 

Follow Khatabook for the latest updates, news blogs, and articles related to micro, small and medium businesses (MSMEs), business tips, income tax, GST, salary, and accounting.

FAQs

Q: Can I get a loan only with my Aadhaar card?

Ans:

One of the main documents needed to apply for an immediate personal loan is your Aadhaar card. While it might be the proper documentation for proving your identity and residence, your and/or /business’ bank statement is still needed to verify your income.

Q: What elements influence your business Aadhaar loan application?

Ans:

Elements that influence the application are the company’s financial standing, utilization plan, CIBIL score, and loan amount.

Q: What documents are needed for a business Aadhaar loan?

Ans:

The documents required for a loan on an Aadhaar are: Personal and business PAN cards, bank statements of all business bank accounts for the last six months, an Aadhaar card, a GST registration certificate, Photograph, and Shop and Establishment certificate.

Q: What is a business loan for an Aadhaar card?

Ans:

For a small company or business, a short-term business loan can be of great help in times of crisis, like buying raw materials, paying operating expenses, hiring new employees, or expanding operations. Your Aadhaar card can help you get a loan from an Aadhaar card at times like this. You can use your Aadhaar card to get a business loan by uploading a soft copy of your Aadhaar card and other documents supporting your business status and personal information.

Disclaimer :
The information, product and services provided on this website are provided on an “as is” and “as available” basis without any warranty or representation, express or implied. Khatabook Blogs are meant purely for educational discussion of financial products and services. Khatabook does not make a guarantee that the service will meet your requirements, or that it will be uninterrupted, timely and secure, and that errors, if any, will be corrected. The material and information contained herein is for general information purposes only. Consult a professional before relying on the information to make any legal, financial or business decisions. Use this information strictly at your own risk. Khatabook will not be liable for any false, inaccurate or incomplete information present on the website. Although every effort is made to ensure that the information contained in this website is updated, relevant and accurate, Khatabook makes no guarantees about the completeness, reliability, accuracy, suitability or availability with respect to the website or the information, product, services or related graphics contained on the website for any purpose. Khatabook will not be liable for the website being temporarily unavailable, due to any technical issues or otherwise, beyond its control and for any loss or damage suffered as a result of the use of or access to, or inability to use or access to this website whatsoever.
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Disclaimer :
The information, product and services provided on this website are provided on an “as is” and “as available” basis without any warranty or representation, express or implied. Khatabook Blogs are meant purely for educational discussion of financial products and services. Khatabook does not make a guarantee that the service will meet your requirements, or that it will be uninterrupted, timely and secure, and that errors, if any, will be corrected. The material and information contained herein is for general information purposes only. Consult a professional before relying on the information to make any legal, financial or business decisions. Use this information strictly at your own risk. Khatabook will not be liable for any false, inaccurate or incomplete information present on the website. Although every effort is made to ensure that the information contained in this website is updated, relevant and accurate, Khatabook makes no guarantees about the completeness, reliability, accuracy, suitability or availability with respect to the website or the information, product, services or related graphics contained on the website for any purpose. Khatabook will not be liable for the website being temporarily unavailable, due to any technical issues or otherwise, beyond its control and for any loss or damage suffered as a result of the use of or access to, or inability to use or access to this website whatsoever.