Term Loan

A Term Loan is a type of loan provided by banks or financial institutions for a fixed period of time and at a predetermined interest rate. It is typically used for capital expenditures, business expansion, asset purchases, or large-scale projects.

What is a Term Loan?

A Term Loan is a lump-sum loan that is repaid in regular installments (monthly/quarterly) over a specified term — typically between 1 to 10 years. It can be secured (against collateral) or unsecured, depending on the borrower's profile and purpose. Key Advantages of Term Loans: 1. Fixed Repayment Schedule – Helps in better financial planning and cash flow management. 2. Lower Interest Rates (compared to credit lines) – Especially if secured with property or assets. 3. Flexible Tenure – Based on your project or business need (short-term, medium-term, or long-term). 4. Large Amount Eligibility – Higher funding options for significant investments or growth plans. 5. Tax Benefits – Interest paid on business-related loans is usually tax-deductible.

How to Use a Term Loan?

A Term Loan is best used for: