It’s very important to know about Banks’ conditions to meet before opting for a business loan through any bank in Pakistan.
Many people think of starting a new business by getting Bank loans which is not in practice in Pakistan.
No bank in Pakistan provide loan to start a business rather they provide loans to such businesses which are already in a healthy position and earning a handsome profit.
If you have no business and want to start a new one then you can’t take loans directly from commercial banks but you have an option to go for Govt loans scheme like Kamyab Jawan Program to get a loan to start a new business from scratch.
But for a business that is already in a good and healthy position and earning a handsome profit, you may get a loan for your business easily through commercial banks in Pakistan.
For this, you need to have a really good bank statement on your business name and run your business account under your business name title for a year or more in some reputable commercial bank.
Further, you need to have some commercial property to offer to the bank to mortgage it against business loans.
Usually, banks provide loans 60% of the value of your commercial property.
There are certain charges as well for all of this business loan process like processing fee, valuation of property fee, legal opinion charges and more.
Banks in Pakistan Usually provide business loans for the expansion and growth of existing businesses after evaluating their liquidity and net worth.
You Need to have good relationships with the branch manager and yes that is very important to get a business loan in Pakistan through commercial banks.
The bank manager must be confident about your business strength and must be well aware of the business segment you are involved in.
If your business is small scale then you may get a small number of loans through microfinance banks but they usually charge a higher mark up as compared to the commercial banks.
And if your business scale is bigger then you will have to go to some commercial banks for business loan purposes.
You have two options for a business loan in Pakistan one through conventional banks and the other is through Islamic banks.
There are above 40 banks in Pakistan and three of them are completely Islamic like Meezan Bank, Bank Al Islami and Dubai Islamic Bank whereas other banks have their Islamic branches.
As Islamic banks are attracting more and more customers in Pakistan hence every bank is opening more and more Islamic branches and their network if conventional branches is decreasing and their Islamic branch network is increasing with the passage of time.
You may get a business loan in a different way. Sometimes you need cash to grow and expand your business and sometimes you need cashless business loans to settle your demand.
For a cashless business, loan you may get a bank guarantee to give it to your suppliers of business goods. The Bank Guarantee loan is cheaper than cash-based loans as in bank guarantee you give some commission to the bank but on cash base business loan you have to give some markup.
Best banks in Pakistan for a business loan include Meezan Bank, Bank Al Falah, Standard Chartered Bank etc.