Regardless of the size of the company, everyone needs cash to start, maintain and grow. A small company also has smaller opportunities and can not dress in the ways of financing the company. This does not mean, however, that he remains in a stalemate and does nothing without his own resources. A small company also has options. It can spend not only its own resources, but also money from a loan or things from leasing to finance the enterprise.
Financing the enterprise through credit is directed mainly to small and medium enterprises. This is due to the fact that big factories have a lot more opportunities and credit is not the best solution for them. Due to the fact that a small company can not offer all available solutions, a loan can be a good solution, thanks to which we will finance a company.
One of the types of credit available to small and medium-sized companies is a revolving loan. The working capital loan is intended to cover the company’s current expenses. Thanks to it, the company’s financial liquidity is maintained. It is useful not only in crisis situations, when we do not have the money to cover all debts. It also applies to companies operating seasonally, which before the season requires a cash injection, which in a short time are able to catch up with a vengeance. A working capital loan is a short-term loan. The loan period is from 1 to 2 years.
The investment loan is intended as the name suggests the purchase of assets that will contribute to the company’s development. Thanks to it, for example, we will modernize production, buy new machines or buy modern technologies. It is a loan for investments. The loan period is much longer than in the case of a working loan and amounts to as much as 15 years.
If we are a newly opened small company, we do not have much chance for a loan. It is worth remembering that credit is not the only solution. There is also a leasing contract, which assumes that one party to the contract transfers the other thing that it can use. In return, he agrees to pay the leasing installments. The lease agreement is less formalized, and thanks to the fact that the entity handing over the use of the item is its owner at all times, the leasing security is greater than the loan, thanks to which it is easier to obtain it even for a new company. You do not need creditworthiness at the level of credit.