Table of Contents
Introduction
- Are you a business owner who has suffered heavy losses because of the Coronavirus pandemic and are looking to bounce back?
- Do you know how you can get access to easy financial credit facilities that are not complex and have easy terms?
- Have you reached out to banks and other agencies only to be told that you have some issues with your paperwork?
According to studies conducted by the World Bank, nearly four million small businesses have shut down because of the pandemic. The stringent lockdowns, which had been imposed by national governments brought economic activity to a grinding halt.
Small businesses that were dependent on day-to-day sales and operations could not withstand the long period of closure. Without having the ability to open, clear rents, and pay salaries, millions of them shut down forever.
In this article, we are going to help small business owners regarding the raising of credit and financial help. However, before we do, let us first look at why private finance is becoming more popular than government help.
Are the National Governments doing anything to help Small Businesses?
According to leading United Kingdom private lender, Ukcredit.sg, governments the world over are doing very less. This is primarily because they themselves do not have many funds given the poor tax collection rates during the pandemic period.
The tons of paperwork, bureaucratic malpractice, and corruption meant that majority of businesses did not get financial help.
Many business owners who previously ran their own establishments started applying for unemployment benefits. However, here too, they have turned away empty-handed.
In such an event many businesses started looking for other alternatives to help them get back on their feet. Established private financial institutions have come to the rescue of millions of small businesses all over the world, helping them restart their operations.
How to Select the Best Private Financial Institution for Business Loans
1. Do your Online Research
Before you walk up the office of any financial institution, it is necessary that you do your research. This means to read up on their reviews and gather what people are telling about them. Try to understand whether they are credible and trustworthy. You do not want your payments to go haywire and start seeing recovery agents at your doorstep.
2. Talk to your Financial Relationship Management honestly
It is important to have a free and frank discussion regarding the terms of the loan, interest rates, repayments, and other details. Once you set the terms and understand exactly the details, you can proceed with the business loan. You do not want any hidden things between the lending institution and your business to remain unsaid.
3. Try to avoid being taken for a ride by the Lending Institution
Yes, you might need the loan to help restart your business, but you should not say yes to any unfavorable terms. There are some private lenders who would want to take advantage of your situation. To this end, they might levy unfavorable interest rates. However, you should not get desperate and fall for their offers. It is important that you do not get exploited.
4. Create your Business Financial Plan
Every small business owner must be adequately prepared with their financial plans for the year. This means that taking loans, EMIs, daily operation costs, salaries, minimum sales targets, etc. should be properly documented. This will allow you to be in a better position to analyze and understand where you stand on your financials.
The Final Word
Small business owners the world over are a very resilient lot. They have used frugal means to set up businesses and most often than not, their hard work has paid off. The COVID-19 pandemic has meant that they will have to restart once again. By taking business loans from credible and established private lenders, they can be in a better position to restart their business operations.
