Traditionally when small enterprises need capital to run their operations or expand their business, they approach the banks for small business loans. When the enterprises apply for small business loans, they keep one or a few of their assets (property or machinery) as collateral and get a large sum of money from the bank at a particular interest rate. If at any circumstance, an enterprise is unable to repay the loan or the interest within the agreed time, the bank can cease the collateral and sell it to recover the loan amount. As simple as that.
Well! As simple as it may sound, it always triggers a sense of fear in the minds of small business owners. Questions like “what if I am unable to repay the loan amount?” and “What if my business doesn’t do as well as expected” keep lurking in their mind. But today, the small business owners have a safer choice, when it comes to financing their business. As each business is unique, their funding requirements are different and it only makes sense to go for a small business loan, which caters to different small businesses and is also safe- An unsecured business loan.
1. No need of collaterals
Unlike the regular small business loans, the unsecured business loan doesn’t require collateral. It provides safety to the business as well as the small business owner. As there’s no need to keep an asset as a collateral, there’s no fear of losing the asset. However, because there’s no collateral involved, the interest rates are higher in unsecured business loans. Nevertheless, no collateral process actually creates possibilities for small businesses to seek loans and flourish. It also makes it easier for anyone without any asset to apply for small business loans. So, for small business owners, who don’t have an asset to serve as collateral or are not comfortable risking their assets for funding. So, the unsecured business loan is the safest and simplest way to grow their business.
2. Higher chances of securing a loan
You would have often heard small business owners say, “it isn’t easy to secure a loan from banks”. While banks have always been quite stringent with their paperwork and processes, they are also not quite generous when it comes to small businesses. And if it is a start-up, then the trouble only doubles. This is not the case however when you apply for an unsecured business loan. It is quite safe to think that you will get what you applied for.
3. Time is money
Unsecured business loans have quick processes because the lender need not spend time evaluating the collateral nor are there too many forms to fill. It is a simpler process and quite streamlined. So much so that there are lenders like Capital Boost, who can help you get an unsecured business loan within 3 days. Time is money for small businesses and unsecured business loans are designed keeping this in mind. After applying for the loan, you need not wait for weeks and months for the loan to get through. Quick approvals make unsecured business loans a safer bet, any day.
4. Your potential is bigger than your Credit score
Next time, when someone tells, you cannot get a loan if your credit score is bad, don’t believe them. Just apply for an unsecured business loan. Lenders like Capital Boost look beyond your credit score and match you to the right lenders to help you secure the loan you deserve.
5. Flexibility of Repayment
Banks often come with fixed monthly payment plans. It doesn’t change as per your need or situation. Whereas, lenders of unsecured business loans provide different repayment options to choose from. The payment could be made daily, weekly, bi-weekly, or monthly. This helps plan the payment timing with expected cash flow for the business owner, thus making unsecured business loans safer even in terms of repayment terms.
6. Bonds build Business
When you have a good track record of repaying your unsecured business loans, you may build a strong bond with your lenders and they may be confident to lend you money for your future endeavors or business needs. This makes it easier for you to approach a lender when you need funding next time, making the process, faster, simpler and safer.
How can Capital Boost Help?
At Capital Boost, we have a unique personalised approach to solving business challenges and it has only helped us offer better value to our clients. Our clients see a higher rate of approval with Capital Boost. Not only are the approval rates on your loan application higher, but the terms are also often better.
At Capital Boost, we strive hard to get it right the first time, probably why most of our business comes through referrals. We believe every business owner must focus on the core of his business. So, while you continue to focus on your business, we will secure that vital loan for you.
Tagged in: Unsecured Loans, Unsecured Business Loan, Business Loan Repayments, Cash Flow, Small Business Loans, No-Collateral Loans