Financing is an important aspect of running a successive business. Funding can be in form of grants, loans, and investors. Over the years, there has been growing popularity of business loans. However, over half of small businesses claim that they do not have access to adequate financing. This situation worsened with the outbreak of the pandemic.

For this reason, it is crucial to understand the various business loan options available. Below is an insight on seven types of business loans available.

Business Line of Credit

Under this, you get to access a business loan with interest accruing on the money borrowed. Notably, you must ensure that the business loan does not exceed the credit limit. In most cases, you will get business loans between $1,000 and $250,000 from your line of credit. The beauty of a line of credit is its flexibility of repayment and is unsecured.

Family and Friends Loans

This is arguably the most common type of business loan. It involves reaching out to your family or friend for financial assistance. However, it is advisable to have a written promissory noting indicating the amount of money and interest rate. Some businesses prefer this type of business loan due to its flexible repayment schedule and ease of access.

Small Business Administration (SBA) Loans

There are three types of small business administration (SBA) loan programs namely microloan, 7(a), and CDC/504 loan programs. Some of the benefits include versatility, accessibility, and application to various fields. You should also note that SBA loan programs are not accessible to non-profits and businesses located outside United State.

Accounts Receivable Factoring

In this financing option, you get to secure prompt business loans to improve your cash flow. In this option, get to forward uncollected invoices to a third party for an advance payment. With this type of business loan, you get to free your capital. One demerit is that the credit line can be costly.

Summary

Here at Quick Capital Funds, we regularly help startups, small to mid-size and large businesses get their hands on the necessary funding through our commercial finance programs. Our business loans come with great interest rates that are very beneficial to all businesses types.