Access to small business loan doesn’t come easy usually. For many small businesses, it’s a tricky game. Most banks don’t lend to small businesses so it’s a matter of either convincing them or finding alternative sources of financing. We take you to some options worth trying.
Some choices you have include crowdfunding, microloans and other types of capital access. You can get capital from Crowdfunding through investments, loans or donations. The idea is to convince “backers” that your business idea has potential and that investing it means possible valuable return. The reward to investors doesn’t have to be ownership or equity of the company.
Microloans, on other hand, refer to small loans available to entrepreneurs with little or no collateral at all. Sometimes these impose restrictions on where you can spend the given funds although most lenders offer financing for equipment, furniture, supplies and operational expense.
As for alternative sources of funding, there are lenders like Gapcap targeting small businesses. Gapcap understands how difficult it is for small companies to access capital especially with existing requirements. Small businesses can leverage this option to their advantage.
Although these alternatives seem easier compared to traditional banks, you still need to prepare before applying. To increase your chances of getting financed, keep in mind the following:
- Know how much you need and where you will use it
- Create a business plan complete with financial projections
- Conduct market research to know the conditions of your industry
- Know your credit history and score
- Research more on small business financing
Most business successes start with a good plan. Make sure you are fully prepared. Contact us at Gapcap for more small business concerns and assistance.