The great thing about private enterprise is the way new opportunities seem to appear around every corner. However Brexit may reshape your business world (and the CBI has recently written about how businesses are preparing for the change) positive and rewarding challenges are likely to appear – if only you are in a position to reorient, diversify or expand your company’s operations.
That shift is likely to require a certain amount of new investment, though, perhaps to:
- develop new lines and products;
- launch a marketing campaign to highlight those new products in the marketplace;
- buy in new supplies and materials;
- refit or re-equip your production processes;
- commission and install new IT systems; or
- give your company that extra flexibility of movement by increasing your available working capital.
Business loans are designed to help you towards the business expansion your company may need to meet such challenges and opportunities.
Although a secured loan might be necessary if you need to raise substantial funding, but this puts at risk the company or personal assets you offer as collateral and invariably involves a long-term commitment to repaying the borrowing over tens of years – during which term the total amount of interest which must be paid also accumulates significantly.
Unsecured, fixed rate, short-term business loans may therefore offer a more acceptable and attractive alternative.
Funding for expansion
Although unsecured, these business loans may still be available for borrowing enough for many of the expansion projects you may need to keep your company on its toes.
Different lenders may have various limits on the amount of borrowing, but a typical range is likely to be around £5,000 to £100,000 – and loans of just £50,000 or so may be quite sufficient to meet your needs.
If you are like many other businesses, you may be prepared to borrow, but want to avoid the long-term commitment of repayments spread over many years and instead repay it as soon as practically possible.
Unsecured, short-term business loans give you just that possibility, with repayment terms typically available from just three to 12 months.
The advantage in repaying your loan over such a relatively short period, of course, is that there is a smaller amount of interest to pay.
Moreover, that total cost of credit is known from the very start, so the impact of all repayments on your ongoing cashflow budget may be easier to manage and remains totally transparent.
Fast and simple
Unsecured, fixed-rate, short-term business loans are also likely to be considerably easier and more straight forward to arrange than a loan from your bank or other traditional lender.
Typically, you have no complicated business plan or cashflow projections to prepare, but instead answer questions designed to give the lender a clear picture of your company and its financial standing – all of which may usually be done online.
The streamlined procedures underlying such online transactions mean that you are generally given a decision in principle on your desired borrowing within just a few minutes.
This must be followed by a formal application, of course, but this too is considered quickly and, if approved, the requested funds may be transferred directly to your company bank account within just a day or two.