Does your business need an urgent cash flow boost? Every business, regardless of size, will experience cash flow issues at a certain point. However, managing cash in and out is a day-to-day challenge for new and small business owners.
Cash flow problems can cause significant interruptions for your business. Unable to pay vendors, get products to market on time or sustain everyday business expenses can cause problems. There are several ways to tackle such predicaments.
But a straightforward way to ride out an unexpected cash flow crisis is to apply for financing. If you’re a new or small company, you might not have a strong credit history to get a loan from traditional banks. If you do, however, the process can take longer than necessary.
There are alternatives to conventional loans that can be considered when you find your business needs quick funding. Take time to learn about your options by reading on.
1. Business Payday Loans
A business payday loan is one option you can apply for immediate financing. It’s a short-term loan that you can easily access in lump sum even without a business plan or credit history. Some payday loan providers have physical stores, while other services are accessible online.
When you apply online, you can get approved within an hour or two and acquire the amount you need in your bank account within days, if not the same day.
You must repay the whole amount within a specified period, typically between two weeks or your next paycheck. Thus, ensure you have a detailed plan to repay the loan on time and avoid any late payment penalties.
2. Business Line of Credit
Another way to quickly fund your business within a single day is having access to a business line of credit, which works the same way as credit cards. It will allow your business to borrow cash anytime you need it, up to a predetermined credit limit, typically between $1,000 to $250,000.
The best thing about a business line of credit is that you only have to pay interest on the amount you take out. Some lines of credits are revolving. This means you can borrow it again without reapplying, provided you repaid everything in full.
3. Peer-to-Peer Loans
You can also get a peer-to-peer loan to fund your business immediately. Instead of using a bank or financial institution, you will work with a group of potential investors keen to invest in a startup or growing company. The application, approval, money transfer, and repayment of this option take place on a specialized online platform.
Typically, you’ll get several offers from the investors according to your credit rating and the corresponding interest rates. Instead of making monthly payments, you’ll have to pay a single sum through the same peer-to-peer platform.
Make the Best Decision for Your Business
Most quick business financing options have a short repayment period. This means you have to pay back the loan within a limited timeframe. Make the best decision for your business by considering the interest rate and what you can comfortably afford.
It’s also worth noting that taking out a loan is a temporary solution. If you find your business experiencing cash flow problems repeatedly, take the time to look into your expenses.