Let’s be real: running a small business or starting one in India isn’t exactly a walk in the park. From managing day-to-day operations to chasing clients and keeping the lights on, finances can get tight. And when you finally decide to apply for a business loan, the bank says, “Sure! Just give us your house as collateral.” Not ideal, right?
That’s where collateral-free business loans come in.
These are loans you can get without pledging any security, perfect for folks who don’t have major assets lying around or simply don’t want to risk them. Whether you’re seeking a loan for starting a new business without security or expanding an existing one, there are now multiple options for a business loan without collateral in India. In this blog, we’ll break down what unsecured business loans in India are, why they matter for startups and small business owners, who’s offering them, and how you can boost your chances of getting approved. Let’s get into it.
What Is a Business Loan Without Collateral?
A collateral-free loan or unsecured business loan is exactly what it sounds like: a loan you don’t need to back up with property, machinery, or any personal asset.
Unlike secured loans where the bank holds onto something valuable in case things go south, unsecured loans are granted based on your creditworthiness, business performance, and income. These loans are a lifeline for SMEs, startups, and even solo business owners who are trying to grow without taking unnecessary risks.
Key Benefits of Collateral-Free Business Loans
- No asset risk – You keep your house, car, or gold where they belong.
- Faster approvals – Less paperwork = quicker processing.
- Ideal for startups and small businesses with limited assets.
- Lower documentation requirements.
- Flexible repayment terms tailored to business needs.
- Great for those looking for a startup loan without collateral or a small business loan without security.
Eligibility Criteria for Unsecured Business Loans (2025)
Before you apply, make sure you tick these boxes for eligibility for unsecured loan:
- Your business should be at least 1 year old (some lenders allow startups too).
- You must have a minimum annual turnover (varies by lender).
- A good credit score (usually 650+ is preferred).
- Recent bank statements and ITR filings.
These conditions are typical for those seeking an MSME loan without collateral or a collateral free loan for new business.
Top Lenders Offering Business Loans Without Collateral in India
5.1 BharatNXT Lending
BharatNXT isn’t your traditional lender – and that’s a good thing. It offers credit-backed business loans using your existing credit card limit, meaning you can unlock funds fast without a lengthy process. Ideal for freelancers, small vendors, and SMEs who need quick working capital.
- Fully digital onboarding
- Minimal paperwork
- Approval in just a few clicks
If you’re looking for the best instant loan app in India, BharatNXT is right up there for business needs.
5.2 Lendingkart
Known for supporting small businesses, Lendingkart offers unsecured loans up to Rs. 2 crore. Their strength? Fast turnaround and zero collateral.
- Disbursal in 3–5 days
- Suitable for businesses with at least 6 months of operations
- Flexible repayment between 6 to 36 months
5.3 RazorpayX Capital
Primarily for Razorpay merchants, but expanding fast. Offers loans based on transaction data.
- No collateral
- Ideal for growing eCommerce brands and digital-first SMEs
- Seamless integration with payment gateway
5.4 Indifi
Another digital lender with customized solutions for businesses in retail, travel, hospitality, and education.
- Loans up to Rs. 50 lakh
- Based on your industry, repayment pattern, and cash flow
- Quick online application
5.5 FlexiLoans
True to its name, this platform offers flexible lending options to micro and small businesses.
- Minimal paperwork
- EMI-based repayment
- Credit score isn’t the only factor they consider
5.6 SIDBI (Special Schemes)
SIDBI runs government-backed schemes for MSMEs. While some require partial security, others are available under special categories with no collateral.
- Subsidized interest rates
- Support for women entrepreneurs and new businesses
- Needs slightly more paperwork but worth the effort
Documents Required to Apply
To apply for a loan for business without security, you’ll typically need:
- PAN & Aadhaar card (business owner)
- Business registration proof (GST/Shop Act/Udyam Registration)
- Bank statements (last 6–12 months)
- ITR filings or GST returns (for last 1–2 years)
Read more about Restaurant Cash Flow Management Through Credit Cards
Tips to Improve Your Chances of Getting Approved
- Maintain a strong credit score – This helps for any SME loan without collateral.
- Clean financials – Avoid bouncing cheques, overdrafts, or inconsistent cash flow.
- Apply with a clear business purpose – Whether it’s expansion or working capital, state your goal clearly.
- Compare lenders – Pick the one that fits your business profile best.
- Understand how to get a loan without security – every lender has slightly different conditions.
Final Thoughts & Recommendation
Unsecured business loans are a game-changer, especially for new-age entrepreneurs who don’t have property or assets to pledge. In a fast-moving market like India, these loans offer flexibility, speed, and access – all without tying up your personal wealth.
If you’re looking for a quick, reliable, and paperless experience, BharatNXT Lending is a fantastic place to start. Whether you need a collateral-free business loan, a startup loan without collateral, or a loan for starting new business without security, BharatNXT offers a digital-first solution tailored for your needs.
👉 Ready to fund your business without the paperwork headache? Apply now with BharatNXT
FAQs
Can I get a business loan without collateral in India?
Yes! Many fintech lenders like BharatNXT, Lendingkart, and others offer business loans without collateral based on your credit profile.
Which bank gives unsecured business loans?
Private and public sector banks, as well as NBFCs and fintech platforms, offer these loans. However, fintechs usually have faster processing.
What is the maximum amount I can borrow without security?
It varies. Some lenders offer up to Rs. 2 crore based on your eligibility.
How long does approval take for unsecured loans?
With digital lenders, approvals can take as little as 24 to 72 hours, provided your documents are in order.