Personal business loans refer to loans issued by banks to individuals engaged in legal production and operation for directional purchase or lease of commercial houses, machinery and equipment, and for meeting the working capital needs and other reasonable capital needs of individual holding enterprises (including individual industrial and commercial households).

According to different loan purposes, personal business loans can be divided into personal business special loans (hereinafter referred to as special loans) and personal business working capital loans (hereinafter referred to as working capital loans).

(1) special loan

Special loans refer to loans issued by banks to individuals for directional purchase or lease of commercial houses and machinery and equipment, and the main source of repayment is cash flow generated by operations.

Special loans mainly include personal commercial housing loans (hereinafter referred to as commercial housing loans) and personal operating equipment loans (hereinafter referred to as equipment loans).

Commercial housing loans refer to loans issued by banks to individuals for the purchase or lease of commercial housing. At present, commercial housing loans are mainly used for shops (places where goods are sold or services are provided).

Equipment loans refer to loans granted by banks to individuals for purchasing or leasing equipment needed for production and business activities.

(2) Working capital loans

Working capital loans refer to loans issued by banks to individuals engaged in legal production and operation to meet the working capital needs of individual holding enterprises (including individual industrial and commercial households).

Working capital loans are classified according to the conditions of unsecured loans.

Used for (secured working capital loans) and (unsecured working capital loans).

Guaranteed working capital loans refer to loans issued by banks to individuals and need guarantees to meet the working capital needs of production and operation.

Unsecured working capital loan refers to the credit loan issued by banks to individuals without guarantee to meet the working capital needs of production and operation.

Characteristics of personal business loans

(1) The loan term is relatively short.

Personal business loans are mainly used to meet the borrower's demand for machinery and equipment or temporary working capital. Therefore, the loan period is generally short, usually 3 to 5 years.

(2) Loans have diverse uses and complicated influencing factors.

Personal consumption loans are mainly used for personal consumption, and the blindness is low. Personal business loans are used for borrowers to buy equipment or for enterprise production and operation, which are affected by uncertain factors such as macro-environment, industry prosperity and enterprise's own operating conditions. Therefore, the loan uses are diverse and the influencing factors are complex.

(3) Risk control is difficult.

In addition to understanding the borrower's own situation, the bank also needs to know in detail the operation of the enterprise run by the borrower, control the capital operation of the enterprise, and ensure that the loan will not be used for other purposes.