Startup Business Loans with No Revenue
Getting a business idea off the ground can be difficult. Also, operating a startup business without adequate finances may seem impossible. Luckily, entrepreneurs can get started with startup business loans with no revenue. This post will highlight some of the best startup business loans with no revenue.
Why Traditional Financial Institutions May Fail to Work
One of the most obvious ways to acquire funds for operating a business is by taking a loan from a traditional money-lending institution. However, most banks and other traditional financial institutions only extend credit to businesses that have been in operation for more than six months. Additionally, to acquire a favorable interest rate, you may need revenue of at least $50,000 and a credit score of 650.
Sometimes, the bank may require you to provide collateral to acquire the loan. If your startup business fails to meet the criteria, you may not acquire the capital you need to get your business running.
Other Business Loan Alternatives
If traditional banks have occasionally turned you down for failing to have enough revenue, there are several options to try out. They Include:
Like typical modern businesses, you need technology to keep your business running effectively. However, acquiring essential equipment may not be easy, particularly if you have a tight budget. Equipment financing is a startup business loan with no revenue that allows you to pay for newly acquired equipment.
Equipment finance allows you to buy business-related equipment such as a vehicle, oven or hauling machine. When you get an equipment loan, you will need to make frequent payments that include the borrowed amount and the interest charged over a fixed period.
As security, most loan providers may use the equipment as collateral against the debt. Once you clear the loan amount, you will own the equipment. Sometimes, the lender may ask you to provide a personal guarantee or impose a lien on other business assets. Therefore, it is advisable to evaluate the loan terms so that you can understand the risks.
Another startup business loan with no revenue is invoice financing. It allows small businesses to acquire loans against their account receivables. Basically, enterprises use invoices as collateral to acquire funds from lenders.
Small businesses with bank loans can take advantage of this form of financing. It is also a suitable option for companies not eligible for traditional bank loans. For most businesses, invoice financing provides the liquidity they need until they can acquire a solid cash cushion.
Invoice financing may be viable for B2B suppliers with clients with established payment histories. Manufacturing, agriculture, and retail companies are among the businesses that can benefit from invoice financing.
Business Credit Cards
A business credit card can be a suitable way to access funds for your business’s short-term needs. They offer an easy way for entrepreneurs who don’t have an appealing credit history of paying for operational expenses. The best thing is that these loans are revolving, meaning that borrowers can use them repeatedly depending on their needs.
Most credit card issuers consider the businesses’ cash flows. However, some consider the creditworthiness of business owners. You probably need a credit score of 690 and above to acquire a credit card.
A microloan is another excellent way entrepreneurs can establish and grow their businesses. Typically, borrowers can acquire up to $50,000. These loans have short repayment terms and may come with high-interest rates.
They can be a suitable option for startup businesses that cannot acquire credit from traditional lending institutions. Business owners can use these loans to pay for anything, including new equipment and other operating expenses.
Microloans work in the same way as traditional loans. The borrower is expected to pay back the borrowed money, including the interest rate, over a fixed period. Typically these loans have shorter repayment terms. It is advisable to take your time to shop around to find the best loan terms and rates.
Acquire a Small Business Loan Today
If you don’t qualify for a traditional bank loan or are not ready to endure the hassle of applying for one, you may need to consider applying for a small business loan. At Progressing Business Capital, we are committed to making it simple for you to access short-term finance when you need it the most.
Ready to Get Funded?
You only need to apply online, wait for the loan approval, and receive the funds you need within one business day. Please feel free to contact us today to learn more about how our small business loans can help you establish and grow your business. Our experts are ready to help you find a loan that best suits your financial needs.