24.08.2021
ENTREPRENEURSHIP: INVESTMENT CREDIT TO LAUNCH A SMALL BUSINESS
Creative freedom, personal satisfaction and financial independence. As the owner of a business person, he has the opportunity to work in an area he really likes. In addition, there is freedom to use their skills and knowledge and get personal satisfaction from applying their ideas for business success.
Launching your own business is not an easy venture. However, there are many young entrepreneurs in Bulgaria seeking lending to small business loans. One of the basic conditions is the existence of initial rental capital, equipment, inventory with which most people do not have. And if you do not have enough money or Business Angel, investing in your idea, you have to resort to taking a loan.
Assistance comes banks and other financial institutions offering a variety of types of company and quick credit to launch small and medium businesses. Suggestions are numerous and with a variety of options. You can find loans without a guarantor, rapid corporate loans without collateral, with no business plan with low interest, with minimum documents and many more opportunities for newly opened companies.
Determine the amount required
Often, people think they will need an impossible amount to develop their business idea. The truth is that there is no huge capital for the launch of a small business. Calculate the amount that is the absolute minimum to start work. It is very likely to be surprised when you find that it is not as big as you have done at the beginning.
To begin with, invest a certain amount and wait for you to start receiving income from your company before you put on more money. Therefore, when drawing credit, I specify the minimum you need for a start. Do not risk a larger amount so you do not fall into a difficult financial situation from the start of the venture.
To determine with greater accuracy the required amount of this credit to launch a small business, make a list of all available resources. Including savings, partners, materials, skills that you can put into the idea. All these things can reduce the total you consider to download. Finally, it may be enough that they are enough to start without credit.
Is the business loan being profitable?
If you still consider that you need greater initial capital thanks to the loan you will get quick funding for all your urgent costs since the startup itself. However, it is likely that such a loan requires collateral in the form of movable or immovable property.
Many banks and other financial institutions offer different business loans. When withdrawing such a loan, you will have to go through Red Bureaucratic checks that can delay the granting process. Loans are usually long-term, with free repayment of the principal, interest rates only on the absorption, the amount of which changes depending on the amount of monthly transactions incurred.
If you need urgent money to start your own business, you can also contact creditors who offer quick credits. In their application, the application procedure is much more lightweight, so you will receive the required amount significantly more soon. The minus is that usually the conditions are not as advantageous compared to banks, as the deadlines are shorter and interest - higher.
That is why it is important to answer the question how urgently you need the money. This will judge the situation objectively so you can choose the creditor right for you. Emergency costs for a new business are, for example, purchase of raw material for production or workers' salaries. In all other cases, you need to make sure that the money input will multiply as to allow you to pay the credit with interest and bring you a profit.
What are you watching for?
Before proceeding to signing the contract, carefully get acquainted with all clauses on it, which may include hidden fees and other unfavorable conditions. Make sure you understand the value of the penalty fees in case you are late with a contribution. Inform with which credit agent, you can contact the emergence of questions, problems or complaints and whether there is a person who could protect your rights.
When choosing a financial institution from downloading the loan, study all possible options, offers and promotions. Online has easily accessible information that will help you compare the proposals at an initial stage. The right choice will save you a lot of money and problems in the future. For example, lower interest rates necessarily mean that credit is cheaper, so pay attention to all conditions.
Loan applications in banks follow certain rules and policies before approval. There is always a risk that the requirements not be met by the applicant and the credit for a start-up business is prevented. Therefore, before applying for a loan, check all the criteria that the Bank requires to start processing the application. If you don't do this you may lose a lot of time and effort.
If you are looking for rapid funding for a non-history company that is facilitated applying, the micro credit is also a variant. It is a small amount for a short period of time and money can be at your disposal within a few minutes after approval. Be careful, however, do not come across fraudulent non-bank institutions to abuse your trust.
To make sure the creditor's honesty, the first thing you need to do is check if the company has a license from the BNB and what is the source of funding. Do not download a micro credit that you will not be able to cover with income from your business because it can often get to withdraw a new micro credit.
Credits are secured against assets and this can become a major problem if business does not bring enough earnings to repay the creditor. If your activity does not generate the required profit, you will have to betray your assets. Therefore, you should carefully consider whether to secure the loan against assets at risk of losing some of their business.
