Business Financing
Once you have a substantial amount of money for the initial investment, it is a lot easier to build and grow your business. However, getting the initial investment is the biggest problem for most entrepreneurs. Luckily, you can get help from business financing companies that aim to solve financial problems of companies looking for finance to grow or those that are going through a bad phase financially.
Forms of Business Financing
Overdraft
One of the most popular forms of business financing is “overdraft protection”. This option lets business owners access funds that are more than what they have in their banking account. If you are looking for funds to expand your business or start a new venture, then this option is not for you. Usually, most banks and financial institutions do not authorize funds over $5,000 for business purposes. You can use the “overdraft option” if you are in need of temporary cash or if you need money to buy supplies.
Operating Line of Credit
Like overdrafts, an operating line of credit is also a preferred option of business financing. The operating line option is convenient for minor financing needs. Although it requires quick repayment, this option is popular because it is fast and reliable.
Term Loan
If you have a major financial need to support a new project, then the “term loan” option may be right for you. You can get funds for amounts over $100,000 crucial to buy or lease your offices, renovate the office or to undertake an expansion project. Term loans are convenient and available at both fixed interest and variable rates of interest.
Government Loans
Unlike term loans, government loans and incentives are available at lower interest rates. Getting a government loan is a relatively lengthy process and requires you to have special qualifications or prove that you are in need.
Getting Finance From Business Credit Cards
Credit cards are your best bet if you were looking for immediate financing. Credit card loans can be expensive due to high interest rates. However, it is easy to get quick cash using your credit card. For minor monetary needs, you can get an amount that is decided after assessing your credit limit, credit history and your outstanding debts. Many credit card companies provide exclusive business cards to their clients. These business cards come inclusive of special rates to help you manage your business financing needs. Various reward programs are an added feature of a business credit card.
When deciding on a finance option, you should consult your financial advisor, who is aware of all the current programs available.
