Almost every new startup thinks of how to apply for a business loan on account of expansion related needs. There are several lending norms for startups that you should be aware of. These regulations ought to be eased to accelerate the growth of Indian startups as per experts. There are several expectations from the Government including specific tax exemptions and also greater leverage through schemes like Stand up India among others.
The current Indian Government has shown its interest and willingness to promote and back startups. This has come as a welcome piece of news for thousands of startups that are still finding their feet in the competitive world of business. Startups have several expectations from the Union Budget 2017.
According to several startup founders and CEOs, there should be greater tax exemptions for startups in the Budget for 2017. This will help create better impact from a social perspective. This will directly contribute towards heightened employment generation and will also throw up more income scope for a wider section of citizens. Founders also suggest that business loans have to be made more accessible.
Startups should not have to ponder over how to apply for business loan in a restrictive and ponderous climate. They should instead get more relaxed and flexible lending norms that take business growth and expansion needs into account. More citizens can be spurred to make their investments in startup ventures through special tax exemptions which could well resemble the exemptions granted under Section 80D. This will spur investments in startups and will ease funding related issues. Any such move by the Government will come as a big fillip for the sector as per the views of several founders and CEOs. Additionally, obtaining business loans from leading banks is something that is very difficult and tedious as per common knowledge. This should definitely be looked into for accelerating future progress.
Most startups worry over how to apply for business loan since banks almost always require companies to furnish their income tax returns for a minimum duration of three years. Additionally, banks also assume that these companies will stay profitable all throughout these three years. For a new startup which has just entered the market and requires financial assistance to tide over the initial journey, the formal business loan system is practically out of bounds according to several industry experts. This is why the Government should think of new measures and special loan schemes to be offered by banks for startups, particularly since liquidity is not a problem for banks anymore after demonetization.
Schemes, like Stand up India which takes care of the needs of women entrepreneurs and specific societal sections, should also be expanded to encompass all first generation entrepreneurs in the country even if the Government does not extend these benefits to the entire community of startups in India. These positive measures will ensure that startups get the necessary financial support and other incentives to succeed in a competitive environment. They will also be able to generate more employment as a result.