Achieving business growth is a common aspiration, but purchasing the necessary machinery to support that growth can be financially challenging. Conventional loans often demand collateral, which puts your business assets at risk. However, an innovative solution exists which is machinery loans without security. 

This financing option caters to businesses like yours, providing access to equipment needed for expansion without collateral.

Understanding Machinery Loans Without Security

Unlike secured loans, which require you to pledge assets like property or equipment as collateral, unsecured machinery loans rely solely on your business's creditworthiness. This eliminates the risk of losing valuable assets if you encounter financial difficulties.

Discover how Machinery Loans help in Business Growth.

The Power of Machinery Loans without Security for Businesses

Machinery Loans without security are a game-changer for businesses of all sizes and types. It allows you to:

• Get the necessary equipment without disturbing the existing property

• Enjoy a faster approval process

• Invest in a wider range of machinery 

• Seize growth opportunities

• Secure financing for future endeavours 

Why Choose Machinery Loans without Security?

The advantages of unsecured machinery loans are undeniable:

• No Collateral Risk

• Turnaround time is about 3-4 days.

• Flexible Financing

• Preserved Assets

• Tenure varies from 3 to 5 years.

• Improved Cash Flow

Learn How Machinery Loan Refinancing Can Fuel Business Growth.

Eligibility and Requirements

While unsecured loans offer greater flexibility, lenders still have eligibility criteria. Here's what you can expect:

• Should be above 21 years of age

• Business vintage of 3 years or more

• A healthy track record and positive financials are crucial.

• A good CIBIL (Above 720)

Machinery Loans without Security at Terkar Capital

At Terkar Capital, we understand the importance of streamlined and hassle-free financing to drive business growth. We collaborate with corporates to facilitate fund acquisition through various debt instruments including machinery loans without security. 

Our primary objective is to assess your business growth potential and creditworthiness, to expedite the loan approval process. We are dedicated to helping clients acquire the needed machinery to meet their specific requirements, fueling their growth and expansion aspirations.

Conclusion

Unsecured machinery loans offer a powerful and accessible path to growth for businesses of all sizes. By freeing up your valuable assets, streamlining the funding process, and providing flexibility in equipment financing, these loans empower you to invest in your future.

Remember, a well-informed decision is key. So, carefully assess your needs, compare loan offers and choose a lender that matches your goals. With the right financing, you can unlock new possibilities and drive your business to lasting success.

So, don't let a lack of collateral hold you back. Explore the potential of unsecured machinery loans and watch your business thrive!

How Machinery Refinancing Can Fuel Business Growth?

 

Machinery Refinancing

In today's competitive landscape, staying ahead requires constant innovation and efficiency. For many businesses, particularly those reliant on machinery, this often translates to acquiring the latest equipment. Machinery loans offer a powerful tool to achieve this. However, a potentially overlooked opportunity exists which is Machinery Refinancing.

What is Machinery Refinancing?

Machinery refinancing is a financial strategy that allows businesses to leverage their existing equipment to potentially improve their cash flow and business operations. It can be defined in two perspectives. 

1. One, where there is no loan on the machine - in this case, the machine itself will stand as the collateral and the funding can be arranged against it. 

2. The second one - is in a condition where the machine is mortgaged with any other financial institution with unfavourable terms or with low exposure. In this case, the funding can be arranged by taking over the loan from the existing lender and adding extra exposure. Here the loan-to-value ratio may vary. 

This can translate to lower interest rates, extended repayment schedules, or even securing additional funds for unexpected upgrades.

Learn how Machinery Loans help in Business Growth.

Benefits of Refinancing Machinery:

⦁ Reduced Costs

Introducing the new lender by taking over the existing machine will always help in term of reducing the cost. Cost in terms of interest rate, some bullet payments, increased tenure etc. 

⦁ Lower interest rates

Lower interest rates free up significant capital that can be redirected towards growth initiatives like marketing, hiring, or expanding your product line.

⦁ Improved Cash Flow Management: 

Generally, the tenure of a machine loan will be around 36 to 60 months. However, wherever we replace the existing lender, we can get an extension in the repayment tenure. So higher the tenure, the lower the cash outflow. And lower the cash flow for EMI (interest + Principal ), the higher the support to working capital.

⦁ Unlocking Additional Capital: 

In some cases, refinancing can allow you to access additional funds for minor upgrades or maintenance on your existing machinery, maximizing its lifespan and productivity.

⦁Enhanced Financial Flexibility: 

Whenever the promoters of the company /firm take up the new machine, the machine will have its own capacity to absorb the raw material. So when there is new/additional machinery you always should have the additional working capital. Then only the machine can be used at its capacity. Mortgaging the machine and getting the funds against it will always help to maintain a good financial position. 

The Case for Machinery Refinancing

For manufacturers and industrial businesses, machinery is a fundamental asset for production. However, financing this equipment can create long-term debt obligations. Machinery Refinancing offers a strategic approach to managing this debt and unlocking potential financial benefits.

Imagine a scenario where a company secures a machinery loan at a specific interest rate. Over time, market conditions may change, leading to lower prevailing interest rates. Refinancing allows the company to replace their existing loan with a new one from a different lender, ideally offering a lower interest rate and potentially more favourable terms. This can significantly impact a company's financial health.

Learn through a case study on how to get a machinery loan at Terkar Capital.

Before You Refinance:

Refinancing isn't a one-size-fits-all solution. Here are some key considerations:

⦁ Loan Terms: Carefully analyse the new loan's interest rate, repayment schedule, and any potential fees. Ensure the long-term benefits outweigh the short-term costs of refinancing.

⦁ Market Rates: Shop around and compare offers from multiple lenders to secure the most competitive rates.

⦁ Prepayment Penalties: Some existing loans may have prepayment penalties. Factor this into your calculations to determine if refinancing is truly advantageous.

Conclusion:

By strategically leveraging Machinery Refinancing, businesses can unlock the hidden potential within their existing equipment. The additional capital and improved cash flow can fuel growth initiatives, enhance efficiency, and ultimately propel your business forward. 

⦁ Remember, consulting with a financial advisor can provide invaluable guidance throughout the refinancing process. So, don't let your existing machinery loan hold you back. Explore machinery loan and refinancing options with Terkar Capital and unleash the full growth potential of your equipment!

Insights on Effective Management of Working Capital

 

Overview

 

Working capital is the difference between current assets and current liabilities. It pertains to the amount by which current assets exceed current liabilities. Current assets encompass cash, inventory, accounts receivables, and other assets that can be converted into cash within a year. Conversely, current liabilities refer to the company's short-term obligations, including accounts payable, taxes, and other expenses due within a year. In this article, we will explore valuable insights on how to efficiently manage the working capital cycle, ensuring smooth operations and financial stability.

 

Working Capital = Current Assets - Current Liabilities

 

 

Concept of the Working Capital Cycle

Working capital holds significant importance for businesses across various industries, including services, manufacturing, trading, and agriculture. It is particularly crucial for cash and carries businesses.

The working capital cycle represents the duration it takes for a business to convert input resources into cash through the process of production and sales. These inputs can encompass raw materials, electricity, wages, and administrative salaries. When analyzing the working capital cycle, two key aspects should be considered:

●       The industry-specific

●       The company's operations specific

A shorter working capital cycle enhances cash flow and reduces the risk of customer payment defaults, making it a desirable goal for businesses.

 

 What is the purpose of Working Capital?

There are two primary situations where working capital becomes necessary.

●       One is when your current liabilities (especially creditors) are more Or immediately payable than your current assets (especially debtors) are late receivable. So, In simpler terms, when you have to pay your creditors immediately while your debtors take their time to settle their payments. This situation poses a challenge for your business. In the long run, this may hit the cash flow of the company, you need to fix it immediately.

●       Another condition is where your work orders have increased to a substantial level. So as the company grows, there is an increase in demand for the product. To manage the high demand, you must secure the necessary working capital.

 

The key components of working capital are:

 

●       Current assets: These are assets that can be quickly converted into cash within a year, such as cash and cash equivalents, accounts receivable, inventory, and short-term investments.

 

●       Current liabilities: These are liabilities that need to be settled within a year, such as accounts payable, short-term loans, and accrued expenses.

 

●       Operating cycle: This is the time it takes for a company to convert its inventory into cash, such as the time it takes to purchase raw materials, manufacture and sell products, and collect payment from customers.

 

●       Cash conversion cycle: This is the time it takes for a company to convert its investments in inventory and accounts receivable into cash, minus the time it takes to pay off its accounts payable.

 

●       Net working capital: This is the difference between a company's current assets and current liabilities, and it represents the amount of capital available for day-to-day operations.

 

Significance of Adequate working capital:

 

Adequate working capital is always best for the company. When a company approximately uses its assets, it can efficiently operate the business. The salary payments, daily expenses, or wage payments are never delayed and all the work is effective. Adequate working capital helps reduce the wastage of resources and benefits the goodwill of the company.

 

What happens if working capital slips?

 

For a business to function smoothly, it relies on its working capital. As cash flow is essential for any business to thrive and it serves as the lifeblood of the company. So, it is essential to have sufficient working capital to ensure continuous operations and growth. On the other hand, deficient working capital can lead to various challenges such as delayed payments of salaries and wages, difficulty in managing day-to-day operations, and other complications. To avoid such hindrances, it is crucial to maintain sufficient working capital.

 

How to Raise a Collateral Free Working Capital Fund?

 

In cases where a company urgently requires working capital, it can opt for collateral-free working capital funding. Terkar Capital recognizes the significance of efficient cash flow for businesses to thrive and operate seamlessly on a day-to-day basis. Thus, for companies that require working capital urgently, Terkar Capital is a perfect choice. During financial crises, we assist businesses in swiftly raising funds to meet their working capital needs through various collateral-free financing options such as NBFCs, equity capital, financial aid from relatives and acquaintances, applying for business grants, or seeking assistance from financial institutions.