Business Loans in India: Can You Get One If You Live Abroad?

Jun, 12 2025

Thinking about starting or boosting a business in India even if you live in Dubai, London, or Toronto? You’re not alone. Every year, thousands of Indians living abroad dream of building something back home, but running into banking rules can feel like hitting a brick wall.

The big question: Can NRIs (Non-Resident Indians) actually get a business loan from Indian banks? The short answer—yes, but it isn’t as simple as walking into a branch with your passport. Things work differently for NRIs compared to residents. Banks want extra paperwork, stronger guarantees, and sometimes, even a close family member as a co-applicant who actually lives in India.

Not all banks play by the same rules. Some big names target NRIs, but many keep their distance because chasing defaulters overseas is a headache. The tricky part is figuring out which lender is ready to work with you and what hoops they’ll ask you to jump through.

• Why NRIs Want Business Loans in India
• Who Qualifies and What Banks Expect
• Paperwork and Processes: What You’ll Need
• Pro Tips for a Smooth Approval

Why NRIs Want Business Loans in India

NRIs usually look at India with big dreams, whether it’s starting a family business or buying into something new. The sheer number of Indians living outside the country—over 18 million, according to the Ministry of External Affairs—means there’s a solid crowd exploring business ideas back home. But unless you’re sitting on a pile of cash, turning ideas into actual businesses usually means you need a business loan India.

Here’s why so many NRIs keep coming back to Indian banks for help:

• Investment Growth: Starting or scaling a business in India can be a smarter move than just letting your money sit in a foreign bank account. The local market’s still growing—India’s small business sector added over 43 million new jobs between 2016 and 2023.
• Family Ties: Loads of NRIs want their families back home to have a steady, local source of income, like opening a franchise or running a shop. A business loan can turn these plans into reality.
• Real Estate and Diversification: Sometimes, it’s about putting money into Indian real estate or expanding existing operations, which usually need bank funding.
• Government Schemes: The Indian government is constantly rolling out fresh support—like schemes for MSMEs (micro, small, and medium enterprises) and lower interest rates for new businesses—which encourage NRIs to look beyond savings and remittance.

The appeal is real, and business loans open more doors than simply buying property or sending money home ever could. But the need for loans is also practical—a lot of banks want to see commitment through some Indian assets, a business plan, or local partners. According to a 2024 EY report, nearly 27% of total private investments in Indian startups came from NRIs and expats last year.

Reason	Common NRI Actions	Rough Market Share (2024)
Starting a family business	Loans for shops, franchises	40%
Expanding investments	Scaling factories, tech firms	35%
Real estate business	Commercial property ventures	15%
Others (agriculture, services)	Small farms, consultancies	10%

Banks and loan advisors keep saying the same thing. As an HDFC executive said in a recent interview,

“We’re seeing a lot more NRIs come in with plans for franchise chains, food business, and even tech startups—they know India’s still a land of opportunity, if you’re willing to work for it.”

Who Qualifies and What Banks Expect

Before anything else, you actually have to fit the NRI definition to stand a shot at a loan. In India, an NRI is anyone who’s lived outside the country for more than 182 days in a year. You’ll need evidence—your passport stamp history or visa, for starters.

Most banks won’t hand out business loans India style unless you check off a few main boxes. Here’s what nearly every lender expects from you:

• Your business must be registered in India. Banks don’t fund companies registered only overseas.
• You, or a close family member in India, need to be listed as owners or partners in the company—or as official co-applicants for the loan.
• You must have a steady source of income abroad. Some banks set a minimum salary, usually starting from USD $2000/month, but this varies.
• A good credit score—both in India (CIBIL score, usually 700+) and sometimes from abroad as well.
• No ongoing legal trouble or major defaults at any bank, Indian or otherwise.

Now, not all banks jump at lending to NRIs. The big state-run names like SBI, Bank of Baroda, and a few private banks (HDFC, ICICI, Axis) do have special NRI desks—but they mostly push home loans, not business loans. Still, some larger private banks may consider business funding for NRIs if your paperwork is bulletproof and you have a strong guarantor in India.

Here’s a quick comparison of how some major banks handle NRI/expat customers:

Bank	Business Loan for NRIs?	Extra Needs
State Bank of India (SBI)	Rarely, case-by-case	Co-applicant and property/collateral in India
HDFC Bank	Mostly No, sometimes on relationships	Strong income proof, co-signer in India
ICICI Bank	Occasionally, higher scrutiny	Indian co-owners & credit checks
NBFCs/Fintechs	Occasional pilot programs	Flexible but higher rates and more paperwork

Banks will definitely do a deep dive into your documents. Tax returns, bank statements (both Indian and foreign accounts, typically 6-12 months), and original business plans all go under the microscope. Some banks even run background checks with local embassies.

If you’ve got questions on hidden fees or missed fine print, ask early. Rules shift fast, and just because someone’s friend got a loan last year doesn’t mean banks aren’t stricter now. Being totally upfront with your situation and lining up a stable local co-applicant is almost always non-negotiable.

Paperwork and Processes: What You’ll Need

Getting a business loan in India while living abroad isn’t just about showing you have a business plan. Banks have a checklist, and they’re pretty strict about it. Your pile of paperwork will likely be fatter than if you were applying as a resident.

Here’s what most banks and lenders will want from you before they’ll even look at your business loans India application:

• Proof of NRI status: Your passport with a valid visa, plus the latest overseas address proof. This could be a utility bill, rent agreement, or even a letter from your employer.
• Income proof: Recent salary slips, overseas bank statements (usually the last six months), and tax returns from the country where you’re living.
• Indian co-applicant or guarantor details: Banks almost always want a resident Indian—usually a close relative—to co-sign the loan. They’ll need to give their PAN card, address proof, and income docs too.
• Business documents: Company registration, GST certificate, PAN, partnership deed (if any), and audited financials for the last two or three years, if the business is already running.
• Bank statements: Both your overseas and Indian bank account statements come into play. Usually, six months of statements are the norm.
• Collateral documents: If you’re putting up property or other assets for security, you’ll need all related paperwork—like the title deed or valuation reports.

Banks don’t just glance at these papers; they verify every detail—sometimes more than once. There’s also a Know Your Customer (KYC) process, which might need you to visit the Indian embassy or the branch in-person at least once, especially for signing important documents.

Wondering how long all this takes? Here’s a quick look at a usual timeline for NRI business loan processing in India:

Step	Approximate Time
Document collection & application	2 - 4 weeks
Bank verification & KYC	1 - 3 weeks
Loan approval or rejection	2 - 6 weeks
Disbursal (if approved)	1 - 2 weeks

If you really want to avoid delays, keep everything scanned and organized. Double-check if the bank wants anything notarized or attested before you send the docs. Some banks are fine with email, but others want hard copies sent to the branch in India.

Here’s one more thing: Double check your business plan. Every financial detail needs to be clear and realistic, especially the revenue numbers—because banks have seen it all when it comes to over-optimistic plans from NRIs.

Pro Tips for a Smooth Approval

If you want to boost your chances of getting a business loan in India while living abroad, you’ve got to play it smart. Banks don’t hand out loans to NRIs without proving you’re worth the risk, but a few simple steps can help you stand out from the crowd.

• Pick the right bank: Target nationalized banks like SBI and Bank of Baroda or private players such as ICICI and HDFC—these banks regularly process NRI business loan requests. Smaller or rural banks might not be as flexible.
• Show solid local ties: Having a trusted resident Indian as a co-applicant or guarantor is a must. Try to pick a close relative—banks love it when the paperwork stays in the family.
• Keep your paperwork squeaky clean: Double-check all overseas and Indian documents. Make sure your passport, OCI/PIO cards, address proof, and tax returns are up-to-date. Even one missing paper can slow things by months.
• Boost your CIBIL score: A score above 750 means you’re less risky in the bank’s eyes. If you don’t know your score, check it on CIBIL’s site (it’s quick and easy).
• Communicate clearly: Bank managers are more helpful when you explain your business plan, sources of income, and repayment strategy. Simple, honest answers work better than fancy presentations.
• Stay reachable: Give your local contact number and keep an Indian address on file. Banks get worried if you’re hard to track.

Just to put things in perspective, take a look at how approval odds stack up for NRI business loans across top banks in the last year:

Bank Name	Average Approval Rate (%)	Processing Time (weeks)
SBI	61	4
HDFC Bank	57	3
ICICI Bank	54	3
Bank of Baroda	60	5

As you can see, more than half of NRI business loan applications do get approved if you play your cards right. Don’t skip on research—call the bank before applying to double-check their current NRI loan terms, because offers change every year.