The success behind any great business at some point of time has been the approval of a business loan for new business. A bank or a lender approves a loan based the business plan provided by the borrower or the details in respect to the utilization of the loan amount. But business is even today a very unpredictable field. The most unfortunate scenario takes place when the borrower faces significant business loss during the tenure of the business loan repayment. In case of an individual lender, there are also higher chances of negotiating and revisiting the deal made during the business loan requirements. But in case of organizations like banks the scenario is a bit difficult though there are means to work it out as well.
Postpone Loan Payment
The problem in the repayment of EMI is the first sigs for the banks and the lenders to understand that there has been a problem. There are many banks who do not enquire with their clients even when they have not deposited their loan repayment amount for three months. When the borrower sees that the inevitable is round the corner, he can take the initiative to talk to the bank or the individual lender to defer the payment- buying for him some more time to run his business once again and regularize the business loan amount.
Reduction in EMI Payment
This is another very effective way of repaying the loan during the time of business loss. When a business person apply for business loan requirements then based on the loan amount and the repayment capacity a mutually decided EMI payment amount is set. In times of crisis, reduction in the EMI can be an effective tool to pass through this difficult time of business loss.
Altering the Original terms of the business loan
To sail through the difficult phase of business loss, the borrower needs to find new ways to revive his business. In such conditions, he can ask the business loan lender to revisit the terms and conditions of loan buying more time and easing on matters like interest rate can work really in favor of the borrower. But those involved in online business loans they need to reach out to the banker and see to what extent the bank could give a levy to the borrower regarding repayment.
One time Settlement
When the business loss is so high that it has turned into a non-performing asset then the Reserve Bank of India has a rule to declare the business loan for new business as non performing and hence to enter into OTS. Here the borrower will repay the money in one go and hence there is no room for the lender to earn interest rates based on the loan amount. One time settlement falls heavy on both the borrower and the lender. While the borrower struggles to arrange for money than reviving his dying business, the lender incurs loss as he cannot earn from the profit of interest.