Defaulting on a business loan comes with many negative ramifications. Here is the list for the same with suggestions to avoid default situations.

1. What are the
consequences of a
business loan default?

2. Prevalent causes of business loan default
Temporary shut
down of business
due to natural
disaster.
Revenue loss
due to political
unrest or riots.
Negative impact on
business operations
due to changes in
government policies.
Fraud by
employees or
business partners.
01.
03.
02.
04.
1.
2.
4.
3.

3. Repercussions of an
unsecured business loan
default

4. Poor credit score
01.
● A loan default lowers your credit score.

5. Higher interest rate
02.
• Your future loans, if
approved, will carry a higher interest
rate.

6. Legal complications
The lender may
take you to court
to recoup their
losses.
You may have to
declare yourself
bankrupt.

7. Implications of a secured business
loan default
The lender may
seize the pledged
assets.
If the loan is secured
by a guarantor, the
guarantor will be held
responsible for
repayment.

8. Tips for avoiding a loan default
situation
Automate your
EMI payments.
Transfer your
existing debt to a
new lender at a
lower interest rate.
Request that your
lender reschedules
the repayment
terms.
Use emergency
reserve or windfall
gains for
repayment.

9. -Hero FinCorp
“Business loan default has many negative
consequences, but by following the
suggestions above, you can avoid
defaulting on your debt.”

10. CRÉDITS: Ce modèle de présentation a été créé par Slidesgo, comprenant des
icônes de Flaticon, des infographies et des images de Freepik
Thank You
Would Love to hear from you.
Hero Fincorp Limited
09, Basant Lok, Vasant Vihar, New Delhi - 110057
Tel : 18001024145
Email : customer.care@herofincorp.com
Website : https://www.herofincorp.com/
Know More : What happens when you default on a
business loan?