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10 Benefits Of A Business Loan

If your company needs to leverage extra cash, then one option is to apply for business loans. The term “business loan” refers to loans given for startups, expanding, cash flow relief, equipment finance, asset finance or operating your business with more productivity. 2019 research shows that small enterprises fail 29 % of the time simply due to a lack of cashflow, and this can be avoided.

There are 10 key reasons why we recommend using a business finance if your company needs capital.

1. Versatility

There are many types of business loans that can provide a range of benefits for small businesses. Examples that business owners typically request are; to buy equipment for productivity that will pay for itself over-time, or inventory, stock & raw materials, cash flow relief, startup capital, or acquisitions, then taking out a business loan could be the answer. The lender doesn’t mind how you use their money in your business, as long as you repay the loan under the agreed terms and there’s security in place.

2. Simple Borrowing vs Bank Loans

Many people think that applying for a business loan is hard and complicated, and it is if you’re requesting finds from a bank. However, these days, applying for a business loan can be as simple as getting credit card approval. The process of applying for a business loan online with a private lender like Quickloans isn’t as complicated as it was before either. You can apply online and get an answer in less than 24 hours and applying for one takes just 5 minutes.

3. Fair and sensible interest rates

Interest rates and the loan term are the most important aspects of any loan, which is why it’s essential to make sure you know the repayments required and what you’re getting into. Borrowing can be a great way to get the funding you need to cover expenses, grow your business or purchase inventory. Plus, going with a finance company that offers fair and sensible interest rates is one way to mitigate risk.

4. There is no requirement to share earnings with new investors

You can take out a business loan without the fear of giving up any equity in the company or being responsible for any debts that might be incurred after taking it out.

5. No need for a personal security deposit

Another plus of business lending is that there is no need for a personal security deposit. This means that the borrower doesn’t have to worry about the possibility of losing their personal assets, such as their car or home. The limited liability business itself can often provide collateral. We don’t offer unsecured lending, but the business is its own entity.

6. Increase working capital to grow your business

Working capital is the lifeblood of any business. If your business doesn’t have enough capital, it cannot grow and develop, and a business loan is a great way to increase it.

7. Multiple financing alternatives are available from lenders

The availability of choice for companies who require funds is a significant advantage of business loans. There are multiple financing alternatives available from lenders, which means that it is easier to find the one that suits the needs of your company.

8. Tax advantages of a business loan

Taking out a small business loan can provide you with many perks, but the tax advantages are one of the most important.

A business can greatly use deductions by taking out a business loan to cover expenses like advertising or marketing. This can be deducted from the company’s taxable income, meaning that the company will owe less on taxes.

9. Fast disbursement

Speedy disbursement is another huge benefit of taking out a business loan. The entire process is fast, and the investor has the cash in their hand within 24 hours. The amount borrowed can then be invested right away, which is not possible with a traditional bank loan.

10. Better business credit

When businesses take out loans, they can show that they have an established history of creditworthiness. Those who have never taken out a loan before can sometimes be turned down because they do not have this established history.

Taking out a business loan is beneficial because it helps improve the company’s credit score. A company’s credit score is often used by potential lenders when deciding whether or not they will give them financing, for their services or products. These lenders may be hesitant to provide financing if they believe that there is a high chance that the customer cannot pay.

Conclusion

A business loan is a type of financing that helps small and midsize businesses. They can help them meet their short-term needs for working capital.

You can use it to:

  • Invest in new equipment and machinery
  • Meet payroll obligations
  • Buy inventory
  • Recover from unexpected events such as natural disasters.

They allow you to borrow money to grow your company to scale. You can build additional revenue streams without taking on too much risk. Additionally, loan approval is also less than other forms of financing.

Drop us a line today and let’s make your business grow.

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