When financing smaller ventures, individuals mainly depend on savings. However, improving enterprise, marketing and advertising is required for attracting potential customers. As a result, one may opt to look for a loan. We are familiar with the common aspect of borrowing loan through a bank. But, it requires lots of processes or it may take longer before the loan is approved.
Therefore one can sit and re-strategize asking few question such as how, why and where can I get micro loans near me. After that, planning on the usage of the loan can meet the intended purposes.
Why acquire a microloan?
Microloan is a short term loan on the small enterprise. It can be acquired while investing in marketing. With the help of advertising, one can able to reach the target market and attract new clients.
The loans could be on enterprise expansion. In purchasing more stock, or buying bigger premises to move into.
Loans could be used to finance the cash-flow gap which could occur due to the poor rating on credits.
They could be used financing the purchasing of new equipment and machinery.
Loans can be used to service another loan so as not to be termed as a defaulter.
How to get a microloan?
An entrepreneur needs carrying out market research. Knowing various institutions that offer microloan at low rates on interest is important to find the best. Moreover, one should also check on the repayment period.
Secondly, the buyer should ensure that they have legal documents showing ownership proof on the enterprise.
After which credit record is checked ensuring no defaultment on the previous loan.
Microloan lender checks on enterprise age ensuring it’s not less than 6 months.
One should also have collateral or a steady flow of income for servicing the loan.
When all is set right entrepreneurs may wait for loan approval, receive it to service enterprise.
Usefulness of microloan
It’s suitable for small scale enterprises that require urgent money.
Getting directions, entrepreneurial advice from a money lender.
It can be accessed by persons who lack good credit score.
Rates on interest are favourably lower for smaller enterprise.
Disadvantages of getting microloan
Qualifying for loan collateral has to be offered. In case one gives tittle of enterprise, they might end up losing owning enterprise.
Interest rates per annum are higher than bank loans.
One acquires only a limited amount which might not serve the needs of the entrepreneur.
A rise in the country economy depends mainly on the success of small ventures. As an individual one, you may want to make a difference in society by ensuring there is development around the area. Acquiring enterprise capital may be stressful as one may be tempted setting up fundraising. However, everybody is struggling financially and they may not come through. It is time thinking out of the box or begins considering where entrepreneurs can get micro loans near me. It’ll save the cost of making cards and calling people to assist you. It’s also easier negotiating on repayment methods as the lender is aware of the market situation of the area.
Join our newsletter
Subscribe to get the latest "Engineer Your Finances" content via email.