Product · Business Loan

Business Loan Interest Rates 2026

Reviewed by Rushik Patel· Last reviewed: 25 Apr 2026

Business loans provide working capital, equipment finance, or expansion funding for sole proprietors, partnerships, LLPs, and private limited companies. Both collateral-free (unsecured) and secured options may be available. Indicative rates can start at 10% p.a., but the lender controls pricing based on turnover, vintage, credit profile, and its current criteria.

Starting rate

10% p.a.

Max amount

₹5 Cr

Max tenure

7 yrs

Processing fee

1.00% – 3.00%

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Business Loan Interest Rates — Listed Lenders (April 2026)

Compare business loan rate ranges from 15 listed banks and NBFCs in this dated snapshot. Confirm current terms with each lender.

Bank	Rate (p.a.)	Processing Fee	Max Amount	Max Tenure	Highlights
SBI	10.25% – 14.5%Lowest listed in snapshot	1.00% (min Rs 5,000)	Rs 5 Cr	7 yrs	MSME priority processing
PNB	10.35% – 14.75%	1.00% (min Rs 5,000)	Rs 5 Cr	7 yrs	PNB Pragati scheme for MSME
HDFC	10.5% – 15%	1.50% (min Rs 10,000)	Rs 5 Cr	7 yrs	Instant approval for existing HDFC customers
BoB	10.5% – 14.75%	1.00% (min Rs 5,000)	Rs 5 Cr	7 yrs	Baroda Mudra Loan
Canara	10.5% – 14.5%	1.00% (min Rs 5,000)	Rs 5 Cr	7 yrs	MSME priority lending
Union	10.5% – 14.75%	1.00% (min Rs 5,000)	Rs 5 Cr	7 yrs	Union MSME scheme
ICICI	11% – 15.5%	2.00% (min Rs 10,000)	Rs 3 Cr	6 yrs	InstaBIZ portal for MSMEs
IDFC	11% – 15.5%	2.00% (min Rs 10,000)	Rs 3 Cr	5 yrs	Fast digital journey
Bajaj	11% – 15%	2.00% (min Rs 10,000)	Rs 5 Cr	7 yrs	Flexi business loan
Federal	11% – 14.5%	1.00% (min Rs 5,000)	Rs 3 Cr	5 yrs	MSME focus
Tata	11% – 15.5%	2.00% (min Rs 10,000)	Rs 5 Cr	6 yrs	Unsecured business loans
Axis	11.25% – 15.75%	1.50% (min Rs 10,000)	Rs 3 Cr	5 yrs	Evolve business loan for SMEs
Kotak	11.5% – 16%	2.00% (min Rs 15,000)	Rs 2 Cr	5 yrs	Pre-approved for Kotak CA holders
LIC	11.5% – 15%	1.50% (min Rs 10,000)	Rs 3 Cr	5 yrs	Property-backed business loans
Bandhan	12% – 16%	2.00% (min Rs 5,000)	Rs 1 Cr	5 yrs	Micro & small enterprise focus

As of April 2026, business loan interest rates start from 10% per annum and go up to 16% per annum across 15 banks, with loans up to Rs 5 crore and tenure up to 7 years. Actual rate depends on applicant profile, loan amount, and property.

Business Loan Eligibility Criteria

Check if you qualify. These are general guidelines — actual eligibility may vary by bank.

Salaried Applicants

Age: 21 – 60 years
Min Income: Rs 30,000/month
Experience: 2 years
CIBIL Score: 700+

Self-Employed Applicants

Age: 21 – 65 years
Min Income: Rs 5 Lakhs/year turnover
Business Vintage: 3 years
CIBIL Score: 680+

How to Compare Business Loan — 5 Simple Steps

Use the comparison as a starting point; the lender handles assessment, approval, and disbursal.

Share Your Requirements

Share your Business Loan needs — amount, tenure preference, and property details. An advisor can review the information provided, while lender assessment timing and decisions vary.

Compare Available Lender Information

Review available lender information in a side-by-side comparison of indicative rate, EMI, processing fee, and total interest. Confirm current lender documents before applying.

Compare Lender Terms

Compare lender terms based on rate, tenure flexibility, fees, and service information. The lender controls the final offer and decision.

Documentation & Filing

Use the lender's current checklist to compile documents. Submit the application through the channel the lender confirms and retain copies of everything provided.

Lender Sanction & Disbursal

Sanction and disbursal timing are controlled by the lender and may vary with underwriting, property checks, and documentation. Confirm current lender timelines and disbursal conditions.

Frequently Asked Questions — Business Loan

Answers to the most common questions from borrowers across India.

What is the minimum turnover required for a business loan?

Most banks require a minimum annual turnover of Rs 5-10 Lakhs for unsecured business loans. For larger amounts (above Rs 50 Lakhs), turnover of Rs 50 Lakhs to Rs 1 Crore is typically needed. MSME-registered businesses may get relaxed criteria.

Can I get a business loan without collateral?

Yes. Unsecured business loans up to Rs 50 Lakhs may be available from banks and NBFCs. Under the CGTMSE scheme, eligible loans may be sanctioned without collateral with a government guarantee. Review available lender information and confirm scheme eligibility and terms with the lender.

How fast can I get a business loan sanctioned?

Pre-approved offers from an existing bank relationship may be processed faster, while fresh business loans often take several working days. Timing varies with documentation, underwriting, and lender workflow; the lender controls sanction and disbursal timelines.

What types of business loans are available?

Term loans, working capital loans, overdraft/cash credit, equipment finance, MUDRA loans (up to Rs 10 Lakhs), MSME loans, invoice discounting, and trade finance are common options. Compare the product's purpose, eligibility, pricing, and repayment terms with the lender.

Are business loan interest payments tax deductible?

Yes. Interest paid on a business loan is fully deductible as a business expense under Section 37(1) of the Income Tax Act. This effectively reduces your tax liability and the real cost of borrowing.

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