As you start your business, keep in mind that there are lots of options for funding your company. You’ll need money for every aspect of your company, so whether you’re marketing your products, paying employees or want to make sure the utilities are paid, funding is essential. Your first instinct may be to go to the bank for a business loan, but if you don’t want the loan to affect your credit or put you in a tight financial position, there are other non-bank loan funding options you can take advantage of, which we’ll speak about such as Merchant Cash Advance which is the quickest solution out there for a business owner.
You can access various sites to get the funding you need from various donors. Each of the donors makes a small donation, and this is often more practical than asking one or two investors to make large donations. Be sure to read the fine print for various crowdfunding sources before deciding which venue is right for you. Some sites have a payment processing fee, or you may have to raise a goal so that you can keep the funds that are raised on your behalf.
You may be able to get a grant from the government, particularly if your business is focused on research and science. You can also contact your local branch of the Small Business Administration to learn about grants that are offered by businesses and nonprofit organizations in your area. In order to be eligible for the grant, you’ll need to meet certain goals that have been established by the federal government.
Another non-bank loan funding option is invoice advances. For this process, a service provider will give you the funds that have been billed, and you pay this money back when the customer you’ve given the invoice to settles his/her bill. This will help you to maintain the everyday expenses that your business incurs while waiting for customers to pay you the funds that you’re owed.
Short-Term Credit Lines
This type of funding is for unsecured loans that you’re only going to use for short periods of time. Online small business credit line providers can be a great choice if you need immediate funds or you know that you can pay the loan back in a reasonable amount of time. In many cases, you’ll have about 6 months to repay the loan, and you can get up to $10,000.
This form of lending will match your business needs with investors who have funds to provide. You can bypass the banks and your investors will get better returns than with a traditional bank loan. The interest rates for peer-to-peer lending are similar to banks, and the loans are secured in most situations. Just make sure that your credit is in good standing and that you have already set aside a deadline for repaying the funds.
Merchant Cash Advance
Finally, consider the merchant cash advance as a non-bank loan funding option. This type of business funding is best for small businesses in many instances, and you won’t have to undergo a credit check to be approved. Your repayment will be based on the percentage of your debit and credit card sales, and you can get approved in less than a day most of the time. While these other financial options may work well, it’s best to talk to your financial advisor about the merchant cash advance option and how it can work well for your company.