Kotak Mahindra Bank Business Loan Interest Rates
Last Updated : Feb. 6, 2023, 5:25 p.m.
Are you searching for a business loan at attractive interest rates? Don’t worry because Kotak Mahindra Bank gives you the best interest rate ranging from 16% -19.99% on a business loan. Below you can clearly understand about Kotak Mahindra Bank Business loan interest rates and accordingly, you can apply for the loan.
Interest Rates Details of Kotak Business Loan
| Particulars | Details |
|---|---|
| Processing Fee | Up to 2% of the loan amount |
| Interest Rate | 16%-19.99% |
| Documentation Charges | FCCR / RFCCR Loan amount less than ₹10.5 - ₹ 3500+Taxes Loan amount more than ₹10.5 - ₹ 6000+Taxes FCCR / RFCCR Loan amount more than ₹10.5 - ₹7000+Taxes |
| Cheque Dishonour Cheques | ₹750+GST |
| Fee for copy of any document | ₹500+GST |
| Repayment Mode I Account Swap Fee | ₹500+GST |
| No Dues Certificate/Duplicate NOC Charges | ₹500+GST |
| Cibil Report Charges | ₹50+GST |
| Prepayment Charges | 0-12 months 6% foreclosure fee +GST more than 12 months - 5% foreclosure +GST Prepayment Charges – NIL ( If your term loan running on floating rate of interest) |
| Penal Interest Charges | 3% per month+GST |
| Collection Charges | 30% + GST of check / instrument Dishonour Charges + Penal Interest Charges |
| Amortization Schedule / Account Statement Charges | Free once in a financial year, therefore ₹250+GST |
| Annual Review Charges | 1.5% of renewal limit or ₹5000+GST |
| Termination Charges | 6% operating limit if locked within a period of 6 months from the date of agreement +GST 5% of operating limit otherwise+GST |
| Overline Rate/ Penal Interest in case of overline accounts | 3% per month+GST |
| Non-Utilization Charges | 0.25% of the difference between actual and average utilization 25% of the average operating limit during quarter Minimum Charges of ₹1250+GST |
| Interest Certificate Charges | Once Free in Financial Year, therefore ₹250+GST |
Explanation of Some Frequent Charges
Processing Fee:- This is the fee used to process a document related to your business loan application. The amount of processing fees varies from bank to bank. It is negotiable depending on the relationship with the bank.
Cheque Dishonoured:- When the bank rejects the EMI amount paid through cheque then this is called the dishonoured of a cheque. These are some of the possible reasons for Cheque dishonoured such as signature mismatch, overwriting, insufficient balance, incorrect information filling, mismatch in figures and words and more.
CIBIL Report:- The CIBIL report is a record of your credit payment history. This information was received from banks and other financial institutions. Basically, these CIBIL reports help the lender to make decisions based on your loan credit history very easily. Cibil Report is also known as the Credit Information Report (CIR)
Prepayment:- Prepayment occurs when you pay in advance. Prepayment is a fee that lender charges from borrowers who repay the loan amount early.
Major Factors affects Business Loan Interest Rates
Below the given points you can clearly understand how business loan interest rates affect. There are several factors that affect the interest on a business loan, which makes the interest on your business loan different from the interest paid by another borrower.
CIBIL Score:- The credit score is determined based on the capacity of the Borrower. If you repay the loan on time, it will improve your credit score, so a good credit score has a positive effect on the lenders. Even borrowers can get additional facilities like low-interest rates if the credit score is 700 or more.
Nature of Business:- The nature of the business determines how business is secured. While processing their business loan application, the lender checks the credit risk based on the nature of the business. So if your business is positive then you get a lower interest rate than negative business.
Business Turnover:- As in determining the eligibility of the borrower is the most important factor in the business is turnover. Yearly business turnover only determines whether the business is profit or loss. Therefore, the business helps in lending the repayment capacity of the business loan.
Business Experience:- Different banks have different criteria for the existence of a business. If you have been running a business in the same area for many years, there is more possibility of getting a business loan at low-interest rates.
How does the Rate of Interest Affect the EMI Amounts?
In order to calculate the EMI, you can use the Kotak Mahindra Bank Business Loan EMI Calculator .
| Principal Amount | Interest Rate | Tenure | EMI |
|---|---|---|---|
| ₹200000 | 16% | 36 Months | ₹7031.41 |
| ₹200000 | 19% | 36 Months | ₹7331.2 |
| ₹700000 | 18% | 36 Months | ₹25306.68 |
| ₹700000 | 19% | 36 Months | ₹25659.21 |
Now you can see in the table above that the tenure and principal amount are the same but the interest rate fluctuates the amount of EMI. Therefore, the business loan interest rates affect the amount of EMI.
