Home Finance Why Digital Copy Of Documents Is Needed For Business Loan

Why Digital Copy Of Documents Is Needed For Business Loan

Business Loan
Business Loan

Any transaction or financial dealing requires documentation as proof. This is relevant for both – personal and business dealings. Similarly, a lending institution requires certain documents for verification before sanctioning a Business Loan. 

With digitalisation, all financial operations, including loans, are now being applied, approved and in many cases, sanctioned online. So, when you apply for a Business Loan online, you are supposed to upload Business Loan documents for processing. 

In this article, we will talk about why uploading Business Loan documents online makes the loan process easier and more secure.

1. Get Your Loan Quicker

Nowadays, the entire loan process, from beginning to end, can be completed digitally. This is because computer algorithms can analyse your documents and financial history to find the best fit for your company’s needs.

Sharing your documents online eliminates the need for document drop-off or collection, manual scanning, human error, and unnecessary delays in the loan approval and disbursement process. In addition, the online loan process allows you to obtain business financing whenever you need it.

2. Digital Documents Improve the Security of Information Storage

When you submit your documents online, you eliminate the risk of your personal and financial information falling into the wrong hands. A lending institution’s top priority is the security of your data, which is why digital sharing is a highly secure data submission and storage portal.

Before sharing documents and information with a third party (such as a lending partner), you are asked for your permission, which you can withdraw at any time.

3. Health Friendly

The world has just emerged from a health crisis, which taught us to be more careful towards our health by maintaining physical distancing and practicing hygiene. In such a scenario, digitalisation of services has helped people stay safe and still get their transactions done.

Nowadays, businesses prefer digital payments or bank transfers over cash, and you can conduct most of your business securely online. 

Similar is the case with loans, where financial institutions are accepting documents for Business Loan digitally. This has eliminated the need to leave the comfort of your home or office and interact with strangers, putting your health at risk.

4. It is Environmentally Friendly

Digital documents allow you to be environmentally conscious! You are not required to make physical copies of your documents, which you will then deliver to a lending institution.

The loan provider may still require scanned copies to be stored digitally with your loan application. So, when you share your Business Loan documents digitally, it helps you in lowering carbon footprint while also consuming less paper.

Documents Required for a Business Loan Online

An applicant must provide the following documents to the loan provider to obtain a Business Loan.

  • Identification Documents: Driving License/PAN Card/Passport/Voters ID Card/Aadhaar Card
  • Proof of Address: Ration Card/Telephone Bill/Electricity Bill/Passport/Trade License/Lease Agreement/Sales Tax Certificate
  • Financial Documents: Last two years’ ITR, as well as computation of Balance Sheet, income, and Profit & Loss a/c for the previous two years.
  • Evidence of Business Continuity
  • Business Ownership Proof: Documents such as a Sole Proprietorship Declaration, a Certified True Copy of the Memorandum and Articles of Association, and a Sole Proprietorship Declaration, etc.
  • Last three years’ audited financials

The following are the steps required to share documents digitally: 

  1. You turn in your paperwork.
  2. Algorithms on computers analyse them.
  3. If a document is missing or incorrect, the system will notify you, and loan provider will contact you to obtain the missing documents.
  4. They will walk you through the process of renewing or re-uploading a document to the Documents Portal.
  5. Once the loan provider has received all of your documents, you can sit back and relax while they do all of the legwork to get you the Business Loan.

Take Away

Now that you understand the advantages of digitally submitting your Business Loan documents, upload them to your lending institution’s online portal and get your Business Loan in record time.

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