A loan refers to funds provided by a bank to an individual or legal entity for a specific period. The transaction is confirmed by an agreement under which the borrower must repay the debt. For many, a loan is the only way to get a large amount. Entrepreneurs also need funds to open or develop their own business.
Business lending is a convenient service for acquiring equipment and raw materials. Getting money is not as easy as it may seem. To make a deal, you need to familiarize yourself with all the features. After all, when starting your own business, it is important to be sure of a positive result.
Banking products
Business lending is supported by the state. Credit institutions are given quotas and instructions on the provision of money to organizations. If the company exists for more than six months, then there is the possibility of obtaining funds for development.
The more the company operates, the more likely it is to open a credit line and expand its commercial niche. It is almost impossible to accomplish this on your own and not to lose capital. To do everything right, entrepreneurs turn to the bank, where there are financial products for all areas of activity.
Receiving funds for small and medium-sized businesses
With the development of their own business, money is needed, therefore, the issue of small and medium-sized businesses is a necessary service. The money issued by the bank is used to improve the company's turnover and investments:
- purchase and repair of equipment;
- improved turnover;
- opening a new field of activity.
Not all novice businessmen use personal money, so they use borrowed funds. These are small amounts and no report is required. If an entrepreneur takes borrowed funds from a bank, he becomes his regular customer. The possibility of a significant increase in profits gives business lending. Banks offer customers various products that have similarities and differences.
Urgent loan
For entrepreneurs, this is considered the most convenient service. Funds are transferred to the bank account of the organization, which has the obligation to return the funds with interest on time. Typically, banks do not need confirmation of the targeted use of money, but require a pledge or invite guarantors.
Business lending allows for a short time to purchase the necessary equipment, transport, improve goods turnover. As collateral is provided:
- the property;
- transport;
- equipment;
- product.
While the contract is concluded, the organization has the opportunity to change the collateral, but only with the consent of the bank. If a loan is taken for a long period, then you can get a large amount of money. And with a short period there is an opportunity to save on interest.
Special conditions
Business lending has some features. Funds are issued in rubles, dollars and euros. The rate is determined by the amount, term and currency. For regular customers, banks reduce rates. Special conditions include:
- some organizations have a seasonal nature of work, so banks provide individual payment schedules for them;
- some entrepreneurs do not have property, and then banks require guarantors.
The decision to grant a loan is sometimes made by analysts based on a business plan. If he is a worker, then a positive response is given to the provision of money.
Credit line
Lending to medium-sized businesses is carried out using collateral. The Bank determines the period of the loan, after which funds are credited to the company's account, but not completely, but as necessary. Interest is accrued only on expenses. This type of lending is convenient for acquiring small quantities of goods.
A credit line has 2 parameters:
- issue limit: the amount of funds for the duration of the line, but some banks begin to interest and for unused money;
- debt limit: a limited amount is provided to the client, above which no money is given.
Benefits of a business line of credit:
- speed of calculations;
- limit increase;
- use of funds for a long time;
- interest payment only for used funds.
Overdraft
Lending to medium-sized businesses can be carried out using overdraft. This service is available with a current account, and no deposit is required for this. Funds are provided on fairly favorable terms. The Bank performs an analysis of the movement of money in the account. As a result, the amount is set, which will be issued to the client if necessary. When the account is replenished with new funds, they debt is closed.
Funds work
There is a fund to facilitate lending to small businesses, which greatly facilitates the situation of entrepreneurs. The organization acts as a guarantor, helping borrowers get a loan. Small business lending is promoted through the cooperation of funds with banks.
A businessman needs to apply for a loan, indicating that he has a desire to have support from a government organization. The Bank considers the situation, taking into account the necessary details. After this, a contract is drawn up, an application for a guarantee is sent to the fund. There is a signing of the document from three sides. A small business lending fund may take a small percentage.
What do you need to know when contacting the bank?
It should be borne in mind that such a loan is issued at high interest rates. Therefore, you should contact the bank only if necessary. If, however, funds are needed, then you need to draw up a contract carefully. For the decision to be positive, you need to draw up a business plan in advance. It shows what the money is needed for and how profit will be accrued.
The reputation of a businessman is important. It is necessary to provide accounting documentation, which will increase the chance of receiving money. It must be framed correctly so as not to be refused. Medium-sized business arouses more confidence in the bank. The pledge may be funds of the enterprise, goods, property.
What documents are required?
Opening an account for legal entities is carried out on the basis of the documents provided:
- statement;
- copy of the charter of activity;
- copy of the balance sheet;
- copy of the memorandum of association;
- copy of the license.
All originals must be certified by managers, and copies by a notary. Other documents may also be required.
Borrower rating
There are 2 types of assessment of the borrower: objective and subjective. From the first, financial statements are taken into account, and from the second - the following aspects:
- management level;
- state of the industry;
- market situation;
- financial reports.
With business lending, there are many risks. The bank has never worked with some organizations, which causes him to distrust. Each year, the number of enterprises that use financial services is increasing.
Where to go?
For business loans are issued by VTB 24 Bank. This banking product is called Kommersant. Businessmen have the opportunity to receive up to 1 million rubles for a period of 6 months to 5 years. Overpayment is charged at a rate of 21-29% and is determined by the maturity of the debt. VTB 24 offers businessmen the following services:
- Overdraft - the overpayment is 11%, the term is 1 year.
- “Working capital loan” - is issued at 10.9%, period - 2 years.
- “Investment loan” - the rate is 11.1%, the term is 84 months.
These programs are also in Alfa-Bank. The smallest amount is 3 million rubles, and the maximum is 5 million. The repayment period can be from 6 months to 3 years. Alfa-Bank issues cards to business owners with a limit of 500,000 rubles. Uni Credit Bank provides funds to improve small and medium-sized businesses. Amounts range from 500 thousand rubles to 25 million. Debt repayment time - from 6 months to 2 years. UralSib Bank gives loans to businessmen from 300 thousand rubles to 10 million. Repayment time - 1 year. You can contact Promsvyazbank, where customers receive from 5 million rubles for 10 years. Here you need to pay a down payment of 20-40%. OTP Bank has the most advantageous offer. The rate is 9.5%. A maximum of 40 million rubles can be borrowed. Sberbank of Russia also provides business lending. Entrepreneurs can count on up to 200 million rubles. And the rate is 13.26%.
To take advantage of the best option, it is advisable to familiarize yourself with several offers, and then choose the most suitable. It is best to apply to several banks to increase the chances of receiving funds. If there are several approvals, then there is the possibility of choice. To date, lending is developing quite successfully. Almost every organization can use the money. If you repay debts in a timely manner, then banks provide more favorable conditions for their customers.