Small Business Loans

Small Business Loans

Running a business is never easy. And this is whether you are a small business or a large-scale business. In fact, as a small business, you face various unique challenges that make it difficult for you to develop and scale. One of these challenges is access to fund. You need considerable funding to make the necessary purchase for business growth. Still, this might not be forthcoming.

Well, you do not have to worry about this anymore. Now, you can easily access fund through small business loans.

What Are Small Business Loans?

This refers to a loan type that is best suited for small scale and medium-sized business enterprises. Typically, you need to have existed for a minimum of six months before you can get access to this type of loan. Also, you must record a minimum revenue of $5,000 every month.

In turn, you can get access to as much as $150,000 in a loan. Even more, you can get them through a fast-tracked process that allows you to apply and get the loan on the same day.

What Can You Finance?

There a wide range of things that you can finance with small business loans. They include:

  • Real estate
  • Renovations
  • New employees
  • Stock and inventory purchase
  • Machinery or Equipment
  • Marketing and Advertising
  • Increase working capital

Small Business Loan Options

There is a wide range of options that you can maximise as a small business to obtain loans. They include:

Unsecured Business Loans

This is one of the most popular financing options for small businesses. It allows you to finance any of your business needs. Typically, this option is short term. As such, you enjoy a repayment period that does not span beyond twelve months. You then get to make repayments weekly or daily.

The advantage of this option is that you do not need to provide any security for the loan arrangement. You can also get it very fast. However, due to the increased risk that the lender bears, you will need to pay higher interest rates.

Line of Credit

This is another finance option that your small-scale business can take advantage of. It is an excellent choice as you can apply the funds to a wide range of financial needs, without any restriction. You can get as little as $5,000 and with some lenders as much as $250, 000. You also get between three month and twelve months to complete the repayment.

However, you will need to settle for a high-interest rate. Although, you only pay interest on the amount you draw.

Invoice Finance

Another option is the invoice finance option. It is also regarded as factoring. It involves a financial product where you transfer ownership of your outstanding receivables to your lender. With this option, the lender buys the invoice at a lower cost from you. Then the lender proceeds to get the price from your debtors, the difference being their gains.

You can get as much as 80 per cent of the total cost. Even more, it allows you to get quick access to funding.

Other financing options include:

  • Hire Purchase
  • Equipment Finance
  • Merchant Cash Advance
  • Commercial Bill of Exchange
  • Personal Loans