In recent years, a great number of small businesses have been finding out that it’s almost impossible to secure a traditional bank loan, especially if you’ve been in business for less than two years. Ever since the economic recession of 2009, approval guidelines for traditional loans have become much more stringent, and far fewer loans are being approved. That has forced many small businesses to turn to alternative lending as a means of filling in the gap left by banks. Here are some of the reasons why alternative lending has become such an appealing option for small businesses.
Many traditional bank loans are in the amount of $200,000 or more, and if you’re looking for less than that amount, chances are a bank is not interested because their profit margin will be minimal. With alternative lending, there are a great many financial solutions other than a traditional loan which can be extremely useful to small businesses. There are business lines of credit, invoice factoring, purchase order factoring, merchant cash advances, and a whole slew of other solutions that small businesses can make use of.
The guidelines used for loan qualifications are much different than they would be with traditional banks, and in some cases, credit-worthiness is not even much of a factor. This makes alternative lending a much more fair and equitable process for most small businesses and increases their chances of being approved for funding.
Even if you are approved for a traditional bank loan, it could literally be weeks or months before you actually receive your cash. With alternative lending, the turnaround time is much faster, and you could have cash in your hands in less than a week, and in many cases just a few days.
Low Interest Rates
There are a number of alternative lenders in the marketplace, and all of them are competing to become your personal lender. One of the ways that lenders can compete is by lowering interest rates, and that works out to your advantage very nicely. There is much less flexibility that can be offered by traditional banks because they are more highly regulated and simply cannot change their policies.
Alternative lending through Integrity Financial Capital
If you’ve had difficulty securing the working capital your business needs, you should consider alternative lending solutions like those offered by Integrity Financial Capital. Contact us today to find out how we can help provide you with the capital you need to grow your business.