A business loan in general terms is access to capital through a lender that is granted exclusively to a business owner.

As we saw in the article What is a working capital loan? A business owner will always be looking for financial stability not only in the short term but also in the long term, a business loan is ideal to provide a solution to the needs of the business.

HOW DO I KNOW IF A LOAN IS RIGHT FOR MY BUSINESS?

Before initiating a financing process a business owner should be clear on the following:

1. USE THE LOAN TO GENERATE MORE MONEY.

A loan is good when you are very clear about the use you will make of it, as long as it is for investment, purchase of equipment, inventory, and payroll. Your return on investment will be in the short term and you will cover the cost of capital without any problems.

2. ABILITY TO PAY

It is also ideal to have a good financial organization in your business regarding your accounts or fixed expenses so that when you access financing your cash flow is not affected at the time of making your payments.

3. DO NOT USE THE LOAN FOR PAYMENT OF PERSONAL DEBTS.

A business owner may make the mistake of accessing financing to get out of personal debt, however, this is not the purpose of a business loan as it is exclusively for the improvement and growth of the business and to prevent the business owner from falling into bad debt.

Having the certainty of the points mentioned above, a loan will always be healthy for the business if there is a clear use of the funds.

WHAT IS A BUSINESS LOAN FOR?

GROWTH

Being able to access a business loan is an efficient way for the long-term growth of a business, whether it is expanding your business territorially or broadening your range of products and services.

MEETING BASIC NEEDS 

A business loan will help us to have a backup in case of emergency situations or simply to cover day to day needs, such as payroll, purchase of materials, supplies etc.

BUSINESS CREDIT HISTORY 

While we know that on a personal level credit is a very important factor to be able to access financing, a business loan will help you build a credit history on a commercial level which will open doors for future refinancing. 

At Capifinders we want a business owner to have the necessary tools to access the ideal financing.

We’ll provide you with advice and guide you through every part of the process.