There are many obstacles that often get in the way of small businesses obtaining the extra funding they require to keep up with monthly costs or to expand. Thankfully, working capital loans can help small business owners to overcome many of these obstacles. Continue reading to learn more about three of the ways in which a working capital loan can make it easier for small business owners to obtain the funding they require.
Working Capital Loans Provide Quick Results
One of the obstacles that many small business owners face when trying to get funding is that traditional funding sources simply will not provide them with the cash they need fast enough. This is especially common when trying to finance the purchase of inventory or make up for a shortfall in their monthly budget. Working capital loans help address this issue by allowing business owners to get cash in their bank account in a very short period of time. In fact, it is often possible to receive an immediate decision on your loan application when applying for a working capital loan.
Working Capital Loans Do Not Require A Credit Check
Another very common obstacle that small business owners face is a lack of business credit. Since most traditional business loans will require a credit check in order to qualify, an inadequate credit history can easily prevent you from qualifying for this type of loan. Working capital loans do not require a credit check since your approval for these loans are not based on your credit history. Instead, a working capital loan is based on the volume of your previous credit card sales. As long as you have a sufficient sales history, you will be able to qualify for this type of loan, regardless of your credit history.
Working Capital Loans Are Repaid Only When Sales Are Made
Many small businesses will see their sales fluctuate frequently throughout the year. The problem with this is that it can make it difficult to commit to a set loan payment every month. Ultimately, fluctuating sales can cause a business to default on a traditional loan during leaner months. That is why working capital loans only require businesses to make a payment towards their loan when they actually have the sales to support this type of payment. Each time you make a credit card sale, a small percentage of that sale will go towards repaying your loan.
For more information about working capital loans, reach out to a local service.