Let's just say small but nice. At times, a small business loan can be just that little bit of a boost. For example, to be able to continue with your company, to replace a broken company asset or to bridge a difficult period. Fortunately, a dozen or so lenders are offering small business credit. Taking out a small business loan always goes online. Little paperwork is required, and your application is usually completed the same day.
Why a small business credit is sometimes useful
Many companies, large and small, depend on a loan to be able to move forward in business. A small business loan is common with:
- Working capital for growth:
Growing pains, so to speak. Growing costs money. Hiring staff, additional marketing expenses or you may need a large deposit for the rent of the new property. Growth costs money, but cash flow is just what slows growth. With a small business loan you have enough capital to be able to move forward again and to take the next one step in Your company.
- Buy stock:
Every entrepreneur with a store or webshop knows how much money is stuck in your stock. You have not yet sold all stock, or not all invoices have been paid, but to place the next one order with the supplier you already have to pay. To avoid being left with an empty warehouse, many entrepreneurs finance their stock. This way you can continue to buy and sell, without problems in your money flow.
- Make small investments:
Entrepreneurship = investing. Whether it concerns tools, a shop design or office supplies, as an entrepreneur you cannot escape investing in your own company. Good equipment is crucial to be able to do your job, but it comes with a price. A small business credit is the perfect solution for a one-time investment.
- Payment of VAT or creditors:
We all try to plan our finances as best we can. But sometimes the VAT return or a large invoice comes just at the wrong time. When our balance is low. It happens to a great many entrepreneurs that they do not get along very well with their cash flow. Borrowing to pay a large invoice (or the tax authorities) is very common.
What are your options?
On corporate banking, we compare 81 lenders, most of them also provide small business credit from € 1,000 to € 50,000. A small business loan is in most cases repaid within 1 to 2 years, but there are also providers who lend small amounts up to a maximum term of 5 years.
A small business loan comes in two forms: you can get a one-off loan or take out revolving credit.
With a loan, you receive the amount in one go, and you repay the amount in monthly installments, while a revolving credit is more flexible. You will receive a certain amount that you can freely withdraw, but you do not have to withdraw the entire loan amount at once.
Do you have a specific loan purpose? Then a loan is usually the best choice. Revolving credit is useful if, for example, you want to finance several small investments that are not made at the same time, or if you are going to incur costs spread over a longer period, such as marketing costs.
Interest and wage bill: details of a small business loan
Differences in interest
A small business loan is in most cases slightly more expensive than when you need a large loan sum.
This is because the lender incurs certain fixed costs, such as administration costs and closing costs that are settled in the interest rate. It does not matter whether you need € 10,000 or € 100,000, the fixed costs for the lender remain the same. With a small loan amount you therefore pay relatively higher costs than with a large loan amount.
In addition, as a small company you run more risk. For example, you are dependent on a small group of customers, in contrast to large companies that have a large and stable customer base. And your small business is more sensitive to changes in the market, just like you probably have a smaller buffer than the big boys. A small business simply falls into a higher risk group, so the lender charges a higher interest rate.
Borrowing a small amount is quite simple: often all you need is an export of your bank transactions from the past 12 months. No annual accounts, tax returns or forecasts and budgets.
The application can be done within 10 minutes and is quite simple.
Advantages of Small Business Credit
- Loan is arranged quickly
- Easy application process
- Broad acceptance criteria, few requirements or conditions
- Large choice of providers, compare pays off
Small business credit disadvantages
- Higher interest
- Most providers have a fairly short term
Which lenders offer a small business loan?
Qeld, Swishfund and BridgeFund are some examples of providers where you can get a small business loan. However, there are more than 20 providers, so comparing pays off.
Use this comparison tool for an overview of all providers and the interest they charge.
What's the best small business credit provider?
With our comparison tool, you will receive a personalized offer from all providers of small business credit within 5 minutes. That is the only way to determine the best provider for Your situation.
The best provider for you depends on your loan amount and loan purpose.