Can the loan applicant use the loan to pay debts or tide over other business contingencies?

If a small business owner or an individual has intentions to use the amount of loan to pay debts or for other purposes, then he/she must be cautious that this borrowed amount cannot be used in other purposes except business promotion. Thus, the loan will be directly applied to the business and there is no permission to implement this amount to use in other purposes. Likewise, the profits and funds that would be derived from the business will use to pay the loan. However, after the clearance of the loan the business has a free hand to use the profits and funds in other usages.

Obviously, the business is bound to follow all the restrictions and regulations of the government; however, if it does not follow the instructions, it would have to face termination of loan and future restrictions as well.

However, if an individual gets able to do unlawful activities secretly, he/she would have to face the consequences eventually. Moreover, on moral grounds this is dishonesty. It means the party is trying to deceive the laws of the country and trying to confiscate of the deserving people.