Business finance is the most integral part of any business venture. In view of the present state of the country, as regarding the coronavirus pandemic the economic situation is tougher than it was a year ago.
Small businesses have been adversely affected by this pandemic in various ways. Hence, the need to search for financing options that can help grow your business.
The search for a proper finance option can be very confusing as there are over 44 different types available to business owners. In this article, we are going to review five most common and accessible financing option that will help keep that small business of yours in the running.
· Personal assets and saving
The most common type of funding for small businesses since time immemorial is personal savings. In this means you put your personal savings and assets are put into business use.
The risks involved using personal savings are bore by the small business owner alone. Using personal savings and assets in business gives you sole control over the business.
· Online loans
Online lenders have become one of the most used financial option for small business owners. Securing online loans is the one of the easiest ways of getting loans, because application usually takes only an hour, and can be done from the comfort of your home.
Although they can be very expensive, online lenders do not charge prepayment penalties. Usually, most online lender have specific requirements pertaining to them. So, it is advisable to read through their requirements before applying.
There so many misinterpretations of what microloans should be. Simply put, microloans are loans of smaller dollar amounts typically used to help small businesses grow. Microloans allows individuals with low or no credit score to be able to startup businesses.
Entrepreneurs who have little or no collateral but are however suitable to start a small business. Although most microloan programs usually have restrictions as to what you should and shouldn’t spend the money on, they are still very reliable.
One of the pros of microloans is that compared to traditional lenders and banks, microloans are easier to obtain. Micro lenders even go to extra mile by giving you advice on how to increase their business returns.
The disadvantage is that some micro lenders usually have inflated interest rate. Undermining this disadvantage, microloans are worth giving a try.
Conventionally, crowd funding works raising funds from a large number of willing people to support your business. With crowd funding, there is no limits to what can be raised as it is done out of the goodness of people’s heart.
Usually, individuals that support small business through crowd funding are entitled to a reward when the business start breeding cash.
This means is one of the convenient because it doesn’t involve any legal process like that of banks and traditional lenders. It also gives opportunity to businesses that their ideas weren’t conventionally accepted to strive.
Clearly, as seen above there are various ways your small business can get funds despite the pandemic. All the methods listed are viable ways with which your small business can be funded. Business finance should be easy to attain after going through this article. Click here!