With the unending need to build and expand business operations borrowers are constantly on the lookout for lenders. Depending on your eligibility and financial credentials, we can help you secure a funding option that works for you. We offer a variety of business lending programs with all kinds of interest rates and repayment plans. If you are not sure what type of loan fits your business, here are is a list of the most popular types of business loans.
- Traditional Bank Loans:
Traditional bank loans are a common choice for many businesses. Companies that are backed up with a proper credit score and produce all the prerequisites for the loan typically bag a deal from the lenders. While they offer competitive interest rates and longer repayment terms, the application process can be time-consuming and may involve strict eligibility criteria.
- Small Business Administration (SBA) Loans:
These are government-approved loans that aim to give a solution for businesses that need financial assistance. Typically every business needs financial aid to support its growth. As the needs of businesses like tapping new areas geographically, planning to enhance the products and build new versions need huge financial support. These funds help to finance these requirements. Additionally, refinancing is also an option the borrowers can utilize with SBA loans. One of the main problems of businesses is managing payments, mainly interest rates. The SBA loans help to reduce interest rates and manage the cash flows with options like debt consolidation. It is a favorable loan product with longer repayment options and less interest rates. Most of the new businesses, therefore, find it more attractive than other loan products.
- Equipment Financing:
For businesses in need of new equipment, loans on equipment can be a viable solution. This type of funding allows you to purchase or lease equipment while spreading the cost over time. The borrowers experience a stress-free and safe loan option as they don’t need any other collateral because the equipment builds confidence for the lenders. Interest rates and terms vary depending on the lender and the equipment being financed.
- Invoice Financing:
Invoice financing, also referred to as accounts receivable financing, helps businesses bridge the gap between invoice issuance and payment receipt. Lenders provide a percentage of the remaining invoice amount upfront, allowing businesses to access instant cash flow. Once the customer pays the invoice, the lender deducts their fees and releases the remaining funds. Some of the companies falling under industries like oil and gas, scientific research, automotive, and more usually have wavering cash flows therefore their payment cycles are longer than usual. This type of loan is appropriate for such businesses.
- Business Line of Credit:
Every business needs a simple finance solution to help get through the financial glitches. With the undeniable urge to stay ahead of the competition, each business looks to build the best products and services to sustain in the market. The survival however demands accessibility to funds as it helps the business to develop new products, expand the business, pay for unexpected expenses etc. it is as simple as using a credit card where the business can utilise the required loan and repay for the same. It is preferred by borrowers because of its flexibility and cost-effectiveness.
- Merchant Cash Advances:
Merchant Cash Advances (MCAs) are a type of financing option available to businesses. They provide a quick and convenient way for businesses. Unlike traditional loans, they are not based on credit scores or collateral, making them accessible to a wide range of businesses. Its uniqueness sets in its repayment structure. The businesses get the opportunity to choose a deferred repayment option which means the repayment amount depends on the business’s profitability or sales. It is fast and convenient making it useful for purchasing inventory, expanding operations, or covering unexpected expenses.
- Peer-to-Peer (P2P) Lending:
The lending industry has a unique ecosystem where borrowers build and maintain a strong network with them. This network is an innovative structure wic connects borrowers looking for funding options through their peers.
Peer-to-Peer (P2P) lending is a digital platform that enables borrowers to directly get in touch with investors. Since it is digitised the borrowers find it much easier to get a loan. Also, borrowers can secure loans faster because of the diverse investment portfolios.
If you are a business seeking funds for any purpose, you can explore the above-mentioned options. Businesses require financial aid always and business loans are a great tool. The digital platforms, therefore, offer simple solutions for every type of loan requirement. Business loans have unique and customized products that suit the different needs of borrowers. funds being an integral part of any business make these loans a viable solution to keep the cash flows running.