4 Tips to Help You Navigate Funding Options & Secure A Loan

4 Tips to Help You Navigate Funding Options & Secure A Loan

Some of the most common sources of funds for start-up businesses include funding from friends or family, angel investors, crowdfunding, and business grants. The most common funding for start-up businesses is to borrow a loan from lending institutions. With a good credit score, you can quickly secure a monthly installment loan in Singapore or any other type of instant loan that is convenient for you.

Here are few expert tips to help you navigate all the funding options available and secure a loan with ease.

1. Understand Your Funding Options

Many start-up businesses or small companies fail to secure loans as most licensed moneylenders use the company’s track record to see if the business can comfortably pay back their loans. In essence, licensed moneylenders want surety of their assets. In Singapore, most new start-ups or businesses are only able to obtain low-cost loans. Look to weigh all the available funding options for you before you decide to start a business. In many cases, the best option is to start a business through your own personal savings or with funding contributions from friends or family.

2. Make Your Business Fundable

Traditional licensed moneylenders want you to be able to demonstrate the affordability of your business to show that you can repay the loan. Most licensed moneylenders and funders in Singapore view a loan request that exceeds 25% of the annual revenue as an unaffordable loan. If your business requires more funding than that amount, you should expect lending institutions to ask for extra proof of how your business is able to repay the loan. Therefore, obtaining a debt consolidation loan or an affordable quick loan ensures that you can pay back the amount without worry.

3. Use Business to Business Invoices

Invoices are good security when you are trying to source funds for your business. Most lending institutions in Singapore will allow you to take an advance for revenues you expect shortly. For example, if you made supplies for company A and the company fails to pay you in the next 100 days, you can ask a banking institution to finance you with the invoice as security. The credit record of company A will then play a role in ensuring whether the financial institution will agree to finance your business or not. As such, you should always look to do business with companies that hold good credit records.

4. Seek Angel Investors

Angel investors can be a good source of capital for start-up business owners. These are wealthy individuals who will put their money on your business in return for bonds or equity. In some cases, angel investors offer more than just money. They provide their experience with you to ensure that your business can reach the highest level. Even though such an arrangement might mean that you have to give up part of your business, seeking angel investors has proven to be one of the best funding options for newcomers in the business.

Conclusion

The long-term goal for every entrepreneur is to grow their business. Building a name for your business in various funding institutions takes more than just borrowing money when the business is about to go down. You should look to involve funding institutions in every step you take. The most important thing is to make them feel like they are part of your business. By doing so, it will also be in their best interests to ensure that the business never goes under.

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