Comparing Small Business Loans and their Repayment Options
Overview
It’s well-known that one of the biggest setbacks when it comes to business growth in South Africa is a lack of funds. For businesses to qualify for funding from banks, government and other financial institutions they often need to fulfil stringent criteria.
Generally, banks normally provide loans to businesses with operating histories.
Small businesses often have more challenging criteria to fulfil with small business owners generally having to wait for up to 3 months to get the money. Repayment terms generally vary from lender to lender.
When we compare small business loans and their repayment options, there are a number of factors to consider.
Places where one can get small business loans include:
Banks
Asset Finance Houses
Small Business Loans Organisations
Venture Capital Funds
Small business owners also need to consider how much money they actually need before applying. Before applying, you also must be clear about what you need the money for. Something important to consider is how long it will take you to pay the loan back. Lenders will also want to see for how long you have been in business and will assess how much collateral you have available to put up. Small business owners also need to have a good credit record.
Absa:
Absa Bank’s funding solutions cater for start-ups and existing medium and micro enterprises with working capital or expansion finance needs.
Small business loans are provided through the Absa SME solution, which offers R50 000 to R3 million with a maximum repayment period of 5 years.
First National Bank (FNB):
With a repayment term of 3 months to 5 years, FNB Small Business loans offer between R2000 and R400 000 in finance.
RainFin:
One of the leading providers of small business loans is RainFin. With repayment options of 48 months maximum, RainFin financial solutions offer R250 000- R100 million.
Comparing small business loans and their repayment options can be a good way of assessing which solutions would be best to apply for.
