Starting your own business is an exciting journey full of hopes, dreams, and the thrill of the unknown. It’s a journey that requires grit, determination, and a sound financial strategy. One of the first obstacles you will face is securing financial backing for your venture.
With the myriad financing options available, finding a loan that is right for you can be challenging. This article will look at two different loan options for start-up businesses. For example, those looking to borrow around €5,000 to breathe life into their business idea.
Where should entrepreneurs look for help?
Both bank and non-bank lenders are keen to support the growth of start-up businesses, albeit on different terms. They offer financial solutions for new ventures, with the primary goal of helping them succeed.
Whether it’s the strict approach of a bank, which requires detailed documentation, or the flexible criteria of a non-bank lender, both provide the capital for startups. Let’s learn more about the terms of each and how to apply for business loans later in this article.
The traditional approach to business financing
Of course, when you start thinking about loans, the first thing that comes to mind is going to a bank. Among the financial products, they offer bank business loans. Indeed, banks usually have stricter criteria for loan approval, including the need for a solid business plan and proof of profitability.
For example, Citadele offers bank loans for businesses for the short and long term. It is possible to apply for a loan with a favorable rate, up to 70,000 euros, with support from ALTUM and the European Investment Bank.
Modern support for small entrepreneurs
On the other hand, non-bank lenders stand out by granting loans without a detailed business plan or financial history. This is a significant advantage for new businesses. Non-bank lenders or intermediaries like Altero are becoming an ideal option for small businesses.
Altero makes finding the most favorable resources easy by partnering with over 20 lenders. This is especially beneficial for start-ups, who are offered loans from €1,000 for 3 to 60 months. The intermediary finances agriculture, factoring, current assets, and more. Learn more about them from the customers themselves, from Altero reviews.
How to choose the right business loan?
It is not uncommon for entrepreneurs applying for a loan to submit a detailed business plan or report. But some start-ups need money almost immediately, without paperwork. So, let’s look at how to choose a person like our hero, Kristap.
In the example of Kristaps, who wants to borrow 5000 euros for his new idea without a business plan and a bad financial history, we will show you how easy it is to apply for a loan. After reading information about Altero and Citadele, comparing interest rates, repayment terms, and ease of application, he leans towards a non-bank lender.
He decides to apply to Altero by following the steps below:
- Kristaps fills out an online application on the lender’s homepage;
- Over the phone, by email, or in person, he tells in 2 words his intention for the business and confirms his identity;
- The lender quickly verifies the application based on the potential of the idea, not Kristap’s financial background;
- If the loan is approved, the entrepreneur gets the 5000 he needs quickly and starts implementing his idea.
Kristap’s choice was influenced by his quick need for money and easy processing. This proves how different factors can prompt you to choose a bank or non-bank lender. Either way, a loan can be ideal for new businesses or entrepreneurs who want to act quickly.
The right financing for your activity
Starting an entrepreneurial venture is a bold step, but your dream business will be within reach with the correct finance partner. It doesn’t matter whether you choose the traditional route with Citadele or the modern, flexible approach offered by Altero.
Read also our other articles:
- How to Build an Inclusive Company Culture
- The Power of Personalization – Enhancing Employee Recognition
The key is choosing a loan to grow your business and realize your vision. Remember, the right financing choice is the one that best supports the growth of your business and aligns with your entrepreneurial vision.
