In the recent times, entrepreneurship has seen quite a high rise. To ensure a smooth functioning of the business, it is imperative for small business owners to know the various ways to procure small business loans. Here are the ten best and easiest ways for you to get access to a small business loan.
Approach small business administration (SBA)
There is a possibility of getting up to $50,000 from SBA, depending upon the reach of your business and the strength of your documentation. However, it is difficult to get a loan without having a strong backing of assets.
Get a microloan for a nonprofit organization
SBA also has a scheme wherein they provide microloans to child-care centers. However, it is a very specific requirement, but useful, if you are planning to open one.
Analyze your options for a personal business loan
There are plenty of banks offering personal business loans at different rates. You will get better interest rates depending on the collateral you are ready to compromise on as a guarantee.
Apply for a small business grant
Grants work like scholarships work in college. Although they are quite difficult to find, there are a lot of private organizations and institutions granting loans related to their fields. The search would definitely be worth it once you procure the desired amount.
Use a site for crowdfunding
There are sites like Kickstarter and Indiegogo, which provide you with a platform for approaching groups of people for the purpose of crowdfunding. Even equity crowdfunding is a path you can tread upon if you are willing to exchange equity for initial funding.
Learn about ROBS
The Rollover for Business Startups (ROBS) is a setup wherein one can use their retirement amount to start a business. You can withdraw up to a certain amount from your retirement fund without any early withdrawal penalties.
Maintain a good credit score
Many small business owners rely upon credit cards to fund them initially. Hence, it is always advisable to have a good credit score otherwise; you are very restricted with the expenditure limit.
Consider P2P lending
There is a lot of peer-to-peer (P2P) options available for lending. Many platforms such as Upstart, Funding Circle, Circleback Lending, and many more provide peer to peer lending, wherein you can connect with potential lenders.
Procure an asset-backed loan
This is one of the easiest ways to get finance. With a strong guarantee, you are sure to procure a great loan. However, if your business has grown a little, then you definitely can put a certain part of your business up as an asset to get a loan.
Use platforms that have institutional investors
With an extended facility of the growing P2P platforms, you can also connect to potential institutional investors.
With the correct documentation and a proper plan for the funding, you can easily procure a business loan and take your business to new heights of success.
