The Unique Identification Authority of India, or UIDAI, has issued 21 crore Aadhaar cards since the concept was first introduced on 29th Sept 2010. Since then, every Indian citizen has been receiving a 12-digit unique identity number based on their demographic and biometric data. 

Compared to the initial years, Aadhaar-based verification procedures of various applications have sped up and become easier using the card information. Even lenders offering business loans will take your Aadhaar details to go ahead with verification and approval of the loan. 

Before approving the loan, the lender verifies your information to ensure that you are who you say you are. When making decisions on AadhaAr loans for business loan applications, the majority of banks and financial institutions prefer to use the AadhAar data as a reference source. 

How Can I Borrow Money Using My Aadhaar Card?

To obtain a loan, you must have an Aadhaar card. You must complete the following procedures in order to apply for an aadhaar loan for business:

  1. Make sure that your Aadhaar number is linked to your personal and corporate bank accounts.
  2. Your mobile number registered with the bank should be linked to your Aadhaar number.
  3. Your PAN should be connected to your Aadhaar card and bank account. 

It is advised that you link your Aadhaar number to other identification documents such as a ration card, voter ID, LPG connection, etc.

Eligibility Criteria for Instant Loans on Aadhaar Cards

You must meet the following requirements to apply for an aadhaar loan for business:

  • The company must have been in operation for over a year as of the registration date.
  • The company should have a monthly turnover of at least Rs. 2 lakh. 
  • To be eligible for the loan, a person must be between the ages of 21 and 65.
  • Aadhaar card business loans are available to sole proprietorship firms, small individual corporations, and private businesses engaged in manufacturing, trading, or delivering services.

Must-Have Documents for an Aadhaar Card Loan

The following documents are needed for an Aadhaar card loan:

  • Business and personal PAN cards
  • Bank statements for the past six months for all business accounts 
  • Aadhaar card and GST registration document
  • Photographs
  • Certificate of Shop and Establishment

How Do I Apply Online for an Instant Loan Using My Aadhaar Card?

You can use your Aadhaar card to apply for a business loan. Here are the steps that you need to follow: 

  1. Fill up the online application form with the relevant details. 
  2. Upload all the required documents to the lender’s portal. 
  3. Verify the application by entering the OTP that you receive on your registered mobile number. 
  4. After the verification and approval of your online application, the lender will send you a loan agreement.  
  5. Once you go ahead with the agreement, the funds will get transferred to your bank account after the deal is finished.

When Can You Avail a Business Aadhaar Loan?

An Aadhaar business loan is a type of loan that offers funds to individuals with a valid Aadhar card. In the banking sector, “Business Aadhaar Loan” is not a word that is commonly known. On the other hand, you’re likely talking about an Aadhaar-linked loan or financing alternative for small enterprises in India.

Any one of the purposes listed on the AadhAar loan for business application has to be met before you go ahead with any loan application. Small, short-term loans are typically required to cover urgent expenses like paying off debts, salaries, or repairs. Additionally, you can use it to renovate, build a website, or advertise your company. You can purchase equipment to make your business run more efficiently.

What Factors Affect Your Application for an Aadhaar Business Loan?

The following factors determine whether a business Aadhaar loan will get approved:

  1. Financial standing: The financial statements assess the position of your company. Before sanctioning the loan, lenders will require financial statements with good accounting practices, consistent cash flows, and a responsible amount of financial reserves. 
  2. Utilization Plan: Lenders will examine your strategy for using a specific loan and take your company’s financial situation into account when evaluating your application. 
  3. Loan Amount: You should only ask for a loan if you are in a dire financial situation. However, a large sum can get declined if you are not able to provide the relevant documents to support your ask. 
  4. Credit Score: Usually, a credit score of 700 from CIBIL is ideal for obtaining any loan. An inadequate CIBIL score raises the interest rate. Your loan application might not get authorized if your CIBIL score is below 650. 

Final Words

The Aadhaar card has developed into a highly integrated digital identity that you may use to swiftly and easily qualify for a business loan. You can utilize your Aadhaar card to secure a loan on Aadhaar if your company is new or small by submitting a soft copy of your Aadhaar card and other necessary documents online. Hopefully, after reading this post, you are now well-informed about Aadhaar business loans, how to apply for Aadhaar loan for business, etc. 

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