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How an engineer loan helps you free up blocked capital

  • Highlights

  • Withdraw flexibly with Flexi Term Loans

  • Purchase machinery and software

  • Meet raw material and inventory costs

  • Hire or buy office space or a factory

You may find that your engineering business has blocked capital in acquisitions like fixed machinery assets or inventory. This can cause cash flow problems and leave you with insufficient funds for everyday operations. In such a case, you can raise finance externally to free up your working capital. You can do this by using a business loan customised for engineers, which offers easy credit on affordable terms.

1. Manage your cash flow better with a Flexi Loan facility:

The Flexi Loan facility offered as an option alongside an engineer loan enables you to meet unpredictable needs like financing cash flow for daily operations with ease. It sanctions an amount to you for a particular tenor and allows you to make multiple withdrawals from the total amount sanctioned to you. You only have to pay interest over the amount you utilise. This facility also provides you the option to pay interest-only EMIs and pay the principal at the lapse of the tenor. This helps you tackle uncertain working capital needs comfortably.

Take a look at 3 ways in which using an Engineer Loan can help you free blocked capital.

2. When you buy machinery or software:

When you streamline your mechanical engineering business by introducing new machinery like milling machines, lathe machine and 3D printing machines, you can speed up production. Doing this with the help of a loan allows you to keep your business savings and working capital intact and so, improves your cash flow. Your savings will remain untouched and won’t be locked in fixed assets. So, purchase the right machinery for your business by borrowing an Engineer Loan from Bajaj Finserv. Here you can gain from benefits like quick approval, nominal rate of interest, flexible tenor and online application.

3. When you buy raw materials to reduce inventory:

It takes a long time for raw materials to get converted into sales revenue. Besides, storing large amounts of raw materials will increase your inventory costs. So, don’t block your working capital in raw materials or costs associated with storing raw materials. Use funds from an engineer loan to buy raw materials like resin and PVC only when you need it. This will ensure that you are able to manufacture products on schedule and maintain a lean inventory. Since you’re using funds from the loan, your working capital will remain free to use for other purposes such as paying bills and salaries.

Top Business Opportunities for Mechanical Engineers

4. When you buy or rent a large office or factory space:

If you run a business, you will also need an office. If this is a manufacturing engineering business, you might need a factory space and/or a warehouse too. These usually come with a long lease and so, using your capital to make these hefty payments is unwise. This is even more relevant if you are buying premises and not renting. Instead, use funds from an engineer loan. Doing this will help you preserve your capital for emergencies or free it up to purchase other assets for your business, such as a car or computers.

Deploying these tactics will ensure that you make the most of a loan for engineers and give your business a boost, without blocking your business’ working capital or savings.

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The material contained in this site and on associated web pages is general information and it is not intended to be advice on any particular matter. Subscribers and users should seek professional advice before acting on the basis of the information contained herein. The decision with respect to any financial product or opportunity or nature or suitability or choice or the viability of any product or service shall always be sole responsibility and decision of the subscriber and user.

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