Advantages of Online Business Loans
In this day and age, traditional banks are not your sole options when you are searching for capital to fund your own business. You can now apply for short term loans, installment loans, or any loan over the Internet which is known as online loan.
Borrowers from ten years ago would not find online business loans a viable alternative for their needs. Instead, conventional banks were the norm when small business owners were in need of funding. Today, the lion’s share of small business loans are still extended by established banks even though availing of one is easier said than done.
What are the reasons commercial banks make it tough for small businesses to access credit? Whether justified or not, they think that lending to small business remains a risky proposition. It does not help that the small business lending process is just as exhaustive as that of bigger business but with a lower payoff. Because of these reasons, only a small percentage of small businesses can qualify for bank loans nowadays.
Thankfully, there are online business loans to fill the slack. What commercial banks won’t serve, online lenders are there to extend credit to small enterprises. In case your bank loan application for your startup business was declined , you may want to look at an online loan. So what are the significant differences between a bank loan and an online business loan?
Applying for a regular bank loan has not been characterized as a speedy process. Applying to an online lender, on the other hand, guarantees a much, much faster process.
The reason for this is that online business lenders are not banking institutions that have to comply with a number of government regulations that slow down the loan approval process. This also means that there is no paperwork required in your application. You do not waste time looking for and gathering documents as the lender won’t need them in processing your application. And because it is online, expect the processing time of your small business loan application to speed up considerably.
Regular banks tend to offer term loans, credit cards, lines of credit and other traditional business loans. On the other hand, online business lenders can adapt their loan products according to your needs. You are not bounded to old loan offerings. Depending on your purpose, there is an online business loan that corresponds to your needs.
Furthermore, online lenders can offer an assortment of loan packages depending on what your small business needs. While many bank loans won’t settle for less than R250,000, online business loans can be from R5,000 to R250,000.