A Quick Rundown of Businesses

Posted by on Feb 24, 2017 in Financial | Comments Off on A Quick Rundown of Businesses

Reasons to Choose Online Business Loans

In this day and age, traditional banks are not your sole options when you are searching for capital to fund your own business. There are loans you can apply for over the Internet which are called online loans that include short term loans and installment loans.

Borrowers from ten years ago would not find online business loans a viable alternative for their needs. Conventional banks were still the preferred source of funding by small business owners. Fast forward to today and commercial banks still lead the way when it comes to providing credit even though regular banks loans are very challenging to secure.

There are reasons why commercial banks tighten access to credit for small businesses. Rightly or wrongly, they still think lending to small businesses is a risky proposition. There is also the notion that the process of extending credit to small businesses is just as laborious as lending to bigger businesses but with lower returns. Because of these reasons, only a small percentage of small businesses can qualify for bank loans nowadays.

Thankfully, there are online business loans to fill the slack. Online lenders are in the lending marketplace to serve small enterprises that were not approved for bank credit. An online loan may be worth your consideration if your application for a bank loan for your small business was rejected. Below are the distinguishing characteristics of an online business loan compared to a bank loan.

Fast cash

If you had experienced applying for a regular bank loan, then you know that it is a slow-moving process. Try applying to an online lender and you will notice the difference in how much faster the process is done.

This is because alternative lenders such as those offering online business loans do not have to deal with a number of government regulations that banking institutions have to follow. No government red tape means no paperwork. You do not waste time looking for and gathering documents as the lender won’t need them in processing your application. And like most things online, the use of technology of online business loans will speed up things significantly.

Accommodating options

With conventional banks, you will be offered common business loans such as term loans, credit cards, and line of credit. Online business loans, on the other hand, afford you some flexibility when it comes to choosing the loan product that will suit your need. You do not have to limit yourself to the usual loans. There are all kinds of online business loans depending on where it will be used.

Furthermore, online lenders can offer an assortment of loan packages depending on what your small business needs. While many bank loans won’t settle for less than R250,000, online business loans can be from R5,000 to R250,000.

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