At some point around 73% of the small businesses have found themselves at a point where they need to be financed. This tells you that you are not alone if you are looking for money to fund your business. There are various financing options that you can choose from which is an advantage. You can choose to go for crowdfunding campaign or pitch your ideas to angel as well as equity investors. Also you can decide to borrow from your family members or friends or go for a loan in the bank. You will discover the benefits that come as a result of taking bank loans for your small enterprise.
The first advantage of a bank loan for small businesses is that the trend of approvals is going upwards. The small business applications have had challenges of being turned down by the mainstream banks. There have been noticeable changes in this situation, however. Due to the gradual improvement in the economy, approvals for small businesses loans have seen a steady rise. These approval rates have even been higher in the community banks as well as credit unions. In case you have kept away from the banks fearing your application form being turned down, this is a good chance for you.
The other benefit of going for a bank loan to support your business is that there is no ownership dilution. The biggest risk in equity is ownership dilution. It is required of you to give up a certain percentage of equity before pumping of money into your business by the investors. The amount of loan you need for the business is therefore required to a tally with your amount of equity with the investors.
In addition to that, you can access different credit facilities. As opposed to the traditional days when banks used to give general businesses loans only, nowadays, you can get different type of loans. Among the different types of loans you can access in banks are term loans, invoice financing, equipment loans, SBA loans, working capital loans, and invoice factoring among many. The application process of the loan is more convenient and make sure quick approvals.
Another benefit of a bank loan for small businesses is that it is possible for you to acquire a significant sum of money. When in need of large amount of cash to help in the development of your business, it is possible for you to get a bank loan worth this amount. You will be needed to prove to the bank that your business indeed requires this amount and that have the capability to pay. If the traditional bank does not provide the great amount of money that you are in need of, it is recommendable to contemplate turning to alternative lenders for example, World Business Lenders, as a result of them offering business loans of up to 2 million dollars.