It is difficult to predict when you will require some urgent capital for your business. Depending upon your need, you will either require a loan for short term or long term needs. It is here that the basic difference of a loan comes into play, affecting the type of loan you should opt for.
Let us see about Working Capital Loans-
Essentially it is utilized to pay for the daily operations of a company. It can also be used to pay immediate expenses such as the salary of your employees, clear a purchase inventory, etc known as working capital loans.
Now let us see some aspects of term loans-
Term loans are meant for slightly higher durations, say 1 to 10 years. These are meant for some long-term goals of your business which may include expansion and investment.
Both the loans are essential to keep the business afloat and meet business goals. There are quite a lot of banks and NBFCs who are in the business of providing loans for organizations to meet their capital needs. It is easier to get loans from NBFCs as compared to banks. Banks may take few days to complete the process whereas NBFC might complete it in 2 to 4 days after you have applied.
The details of the above two types of loans are here:
