At present, there is a liquidity crisis almost everywhere. However, this does not mean the refusal of a loan. An entrepreneur always has a chance to get financing, but he will have to put a lot of effort into this. In this article, we will give several recommendations that will help to achieve this goal. These recommendations will be relevant if you want to get a small business loan online.
- Do not make too much tax optimization. The likelihood of receiving a loan decreases with an increase in the number of different schemes used by the entrepreneur. The reason is that lenders evaluate white accounting and tax reporting. If it shows no profit, then employees conclude that the entrepreneur will have difficulties when paying interest on the loan.
- Even if you use special tax regimes, it is necessary to keep accounts and regularly generate reports. This will allow you to provide the lender with the necessary analytical data.
- You need to save a pledge. As a rule, the premises, equipment, transport, are rented, and the goods produced may not have the necessary degree of liquidity. Even if you are lucky and the lender agrees to give an unsecured loan, you will have to pay for this with higher interest rates, small loan amounts, and short financing terms. The entrepreneur does not need to be afraid to show his assets even if they are issued to family members.
- You should conduct business in accordance with modern standards. Many small businesses today do not plan cash flow, and they do not have a normal business plan. Although lenders prefer to work with disciplined and competent borrowers who plan their business.
- Build your credit history. If you have a chance to take a small loan, take it and maintain it efficiently, without delinquency and early repayment. This is a significant plus for the individual entrepreneur in his subsequent communication with the bank. Additionally, a good credit history allows you to reduce the rate with further bank loans.
- Build the image of a stable and promising enterprise. Reports should reflect growth and improve business performance. You should conclude long-term contracts with customers, which provides substantial guarantees of regular cash flow. Provide information that your market segment is one of the most promising and growing, and not stagnant. The more documents are confirming solvency and prospects, the better it is for your chances of getting a small business loan.
According to statistics, some other factors positively affect loan issuance:
- The borrower must have a permanent registration.
- Family status. Most often, positive decisions are made if the borrower has a formal marriage.
- The age of the borrower should be from 30 to 45 years.
- The number of monthly expenses should not be more than 20% of the salary.