The experience of developed countries has shown that small business brings good income to businessmen, replenishes the state treasury and increases the level of well-being. There are high hopes for the development of small business in Russia. However, its development requires certain financial investments.
Small business loan
Banking organizations are actively developing unsecured lending programs that are aimed at stimulating small businesses. Such financial products also allow you to implement innovative projects.
All proposed loans can be divided according to the principle of cash flow. It is quite difficult for start-up entrepreneurs to get a loan. This is due to the fact that the investor does not have full confidence that the startup will bring the planned profit. To obtain a loan, you will need to create a competent business plan that will satisfy the bank. Entrepreneurs who decide to develop their own business also need additional financial investments. In this case, banks can easily meet businessmen. To obtain a loan, it is enough to provide the bank with the necessary documents that confirm the successful conduct of business.
Lending conditions and requirements for the borrower
Representatives of small businesses are offered various types of loans from commercial banks. Unsecured loans are one of the most popular borrowing areas. They have the following features:
- high interest rate;
- the availability of a guarantor;
- provision of small amounts;
- short loan term;
- loan forfeit.
A banking organization carefully examines the dossier before issuing an unsecured loan for a small business. This is due to the fact that financial investments in a business are risky business. Among the basic requirements that apply to borrowers, the following can be distinguished:
- age qualification from 21 to 65 years;
- citizenship of the Russian Federation;
- positive credit history;
- permanent registration in the area where the bank is located;
- confirmation of solvency.
Credit risk
Providing unsecured loans for small businesses is a risk for a banking organization. Since loans are not secured by collateral, the bank does not have the opportunity to return the invested funds.
In this regard, unsecured loans are provided for a short period and are limited to a small amount. Banks also set a high interest rate on them and provide a short maturity. The listed methods are insurance against possible loan defaults.
Customer Opinion
Many borrowers note in reviews that unsecured loans are associated with the risk of an increase in the interest rate. Therefore, despite the convenience of providing such a loan, the bank can unilaterally increase the interest rate. The reviews report that the banking organization may require early repayment. However, borrowers note that such a situation is possible only if they violate the terms of the loan agreement.
Many borrowers talk about how a business does not always produce the expected results.This can lead to bankruptcy and the need to repay the loan in cash from your pocket.
Types of lending
Small businesses can choose for themselves the most profitable unsecured loan option. Banking organizations offer various loan programs and conditions. Unsecured business loans can be selected depending on the goals. Many entrepreneurs get loans for working capital, which are necessary for the functioning of the business. In this case, banks provide a short-term loan, which will solve the problems associated with the acquisition of materials and equipment.
The main advantage of a loan for working capital replenishment is the possibility of drawing up an individual schedule and long-term repayment without additional sanctions. To obtain this loan, the entrepreneur will need to collect an extensive package of documents that will confirm the success of the business.
In Russia, lending to businesses in Sberbank is most in demand. An unsecured loan in this financial-credit organization can be borrowed according to one of the presented programs. Application for receipt is considered within 3 days.
Overdraft
Legal entities can receive a loan in the form of an overdraft in case of a lack of funds to cover the cash gap and make urgent payments. The main disadvantage of this type is that the money that comes into the account will be used to pay off debt.
Venture lending
This species is not sufficiently developed in the Russian financial market. The essence of the venture loan is that funds are provided on a long-term basis for the development of science-intensive and innovative projects. The indisputable advantage of this type is the receipt of funds for the implementation of any idea.
However, such investments are high-risk, therefore, they do not always bring the planned profit. In this regard, not all banks agree to lend to such projects.
Factoring
In this case, the transfer of debt obligations occurs. A businessman who sells his goods and services receives money from a banking organization, and the buyer repays the debt to the creditor. The main advantage is the receipt of funds immediately after the shipment of the goods. The disadvantage of factoring is the high interest rate on the use of a cashless settlement system, as well as subsequent banking services.
Leasing
If the entrepreneur does not have the opportunity to purchase vehicles, equipment or real estate, you can use leasing. A businessman acquires certain property with the right of subsequent repurchase. The advantage of this type of loan lies in the low interest rate, as well as in the absence of accumulation of the required amount of cash. The entrepreneur should consider the depreciation of equipment that will occur by the end of the loan term. Also, property cannot be resold until full repayment of debt.
Unsecured loan refinancing
The refinancing procedure is carried out in relation to customers who are unable to repay loan obligations in a timely manner.
Banking organizations may also propose a restructuring procedure, which involves a review of the terms of the contract.
These operations are risky for banks, so they try to protect themselves as much as possible from the possible non-return of funds using high interest rates and tight maturities.
