3 Types of Small Business Loans to Consider For Your Company

Small businesses are responsible for 44 percent of all economic activity in the United States. The percentage of gross domestic product (GDP) that this accounts for has decreased over the past few years, but it is still sizable.

Small businesses will continue to stimulate the economy if given the opportunity to expand. But growth can only happen if these companies have access to sufficient capital.

Loans are a viable option for small businesses to access finance. Financial solutions like small business loans exist only to serve the needs of small enterprises in the marketplace.

Small company loans can be an essential source of cash for companies lacking the credit history or other qualifications to qualify for more conventional financing like venture capital or angel investment.

3 Types of Small Business Loan

It entails borrowing and repaying a set amount of money over a set time, plus interest. Common uses for this type of loan include paying for significant expenses or expenditures like new machinery or building.

Term loans

A line of credit (LOC) is a revolving loan from which a company can withdraw funds up to a specific limit as needed. A lender makes money available to a small business on an as-needed basis.

Lines Of Credit

The government guarantees these loans, allowing lenders to provide more advantageous conditions and interest rates. Which also makes them easier to get.

Small Business Administration Loan (SBA)

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