How to Prepare for Starting a Small Business

by admin | January 9, 2020 7:05 am

India ranks as the third-largest start-up hub, according to the NASSCOM-Zinnovreport. The report also states that overall business investments increased in the country by an impressive 100%, from $2 billion in 2017 to $4.2 billion in 2018. This growth has been fuelled by several factors, such as internet penetration, a range of business loans[1] favourable government policies and the large market size.

Despite the rewarding and satisfying nature of start-ups, there are certain things you should know before launching your new enterprise.

Get the Right Account Type for Your Business

To meet the varying needs of businesses, different account types are offered by banks. Having a current account is a necessity for almost all businesses. Some banks offer special current accounts that cater to the specific needs of small businesses.

It is recommended to choose a current account with multi-city banking, unlimited transactions, online as well as free issuance of demand drafts and instantaneous transfer of funds via RTGS, NEFT, and IMPS. Also look for facilities such as mobile alert services, doorstep banking and phone banking. 

Another benefit that current accounts provide is the overdraft facility. Overdraft facility allows you to withdraw an amount higher than your balance for a short period. This facility proves to be extremely beneficial for the immediate cash needs of a business. Interest may or may not be levied by the bank on this account.

Get a Business Loan

One of the biggest challenges faced by any entrepreneur is having enough funds to start and run the business venture. When you run a business, you need funds to pay the salaries to your employees, pay for raw materials, overhead expenses and much more. Business loans can make meeting all these expenses much easier. There are a number of loans available for businesses, such as business loans, working capital loans[2], commercial vehicle loans and loan against property. 

A business loan can be really helpful for diversification and expansion of your venture. On the other hand, working capital finance helps you meet daily finances.

Make Use of Cash Management Services

These days, business banking solutions are not just limited to current accounts or taking a business loan. Banks also offer a range of cash management services. These help business owners in the efficient processing of payables and receivables. Customized pick-up solutions are offered by banks to meet the specific needs of small businesses. Services such as on-premise verification, payroll processing and cash counting are also offered. 

Business Legalization and Registration

Registration of any new company is mandatory. The good news is that with the help of recent reforms, the registration of new companies gets done within one day by the Ministry of Corporate Affairs. All the formalities can be completed online. All the details and instructions you might need are also posted on the ministry’s official website. 

There might also be certain licenses you might need from the state and central government. 

There are a lot of things that go into starting a successful business, such asgetting the research done, choosing the right business loan and a lot more. But, apart from that, one of the most important things to be successful is to have a burning desire for achievement.

Endnotes:
  1. business loans: https://www.idfcfirstbank.com/business-banking/loans/business-loans.html
  2. working capital loans: https://www.idfcfirstbank.com/business-banking/loans/working-capital-loan.html

Source URL: http://incredit.me/how-to-prepare-for-starting-a-small-business/