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Every entrepreneur knows it’s difficult to get the capital to launch a new business. Even when you’ve established your company, it doesn’t take much to knock your cash flow, requiring you to find another source of finance. In this situation, a short-term online business loan can be the perfect solution.
As the name suggests, a short-term loan is intended to be repaid pretty quickly: anywhere from 90 days up to a few years, depending on the amount and the lender. In some cases, an overdraft or line of credit can serve this purpose better, but since the financial crash of 2008, banks have tightened their lending criteria and only offer this type of finance to companies with excellent credit scores.
So what are the key benefits of a short-term online business loan?
Banks tend to have complicated application processes, during which they may ask to see your incorporation documents, balance sheet and up to three years’ trading accounts and tax returns. With an online application, there’s very little paperwork to worry about, leaving you with more time to run your business.
As a consequence of their painstaking application process, banks aren’t known for their quick decision-making. This can be catastrophic if you’ve hit a sudden cash flow hurdle and need money urgently. Online lenders, however, make quick decisions and rapidly follow through with the money. In the case of an emergency business loan, it could be inside your account within 24 hours of applying.
A flexible repayment structure can allow you to find the payment schedule that works for your business and your cash flow. You will be able to choose whether to repay the loan in days, months or years, thus minimizing both your interest charges and any impact on your cash flow.
Although alternative lenders have a reputation for being comparatively expensive, this certainly isn’t always the case. In many cases, online lenders can offer better rates than banks to new businesses or those with marginal credit scores.
Because you’re not parting with reams of documents, the confidentiality of your company is secured.
To arrange a short-term online business loan, you will not need an outstanding credit score or a lengthy business history. Online lenders are more concerned with your ability to repay, so you should not be afraid of applying. There are quite a number of options to choose from, so you should research a number of companies, identify the lender who appears most suitable and then take the plunge. You have nothing to lose and plenty to gain.