Best Bank Loans for Small Business Start-ups

Overview

Bank Loans

Many South African banks are able to provide initial start-up capital, working capital, short, medium and long term lending for small business start-ups. The banks are known for having strict lending criteria, so it’s important that you be thoroughly prepared. 

As a business-owner, you need to make sure that you have comprehensive records showing business profitability. If you have a less-than-perfect credit record, you can forget about getting bank loans for small business. The best bank loans for small business start-ups are provided to those with good credit records. Most banks also require that business-owners have collateral to borrow against.

When applying for a bank loan you need to make sure that you have a sound business plan with specific details about how your business operates. You also need to have your financial statements ready. These should detail how much you need and for what purpose it will be needed.

If you are looking to get the best bank loans for small business start-ups, you need to shop around to see which bank can offer you the best loan terms.

Other finance options:

Government Loans

There are a number of initiatives available for getting funding from the government in South Africa.  One of these types of funding is provided by the Small Enterprise Development Agency (SEDA), which has branches in each distinct municipality around the country.

Loans from family and friends

Getting a loan from family and friends means that they are more likely to offer the most favourable loan terms and interest. You should be prepared for personal and emotional issues and you should be clear on giving versus loaning to avoid any future conflict. At time it may be better to get a loan and to be in debt than offering equity in exchange for a loan.