Applying for Commercial loans
It is often difficult for entrepreneurs to obtain financing when business opportunities arise. Banks claim to be small medium enterprises (SME) -friendly, but many SME applications for a loan are rejected. And even if the loan is approved, the amount is often less than the amount requested. Loans for SMEs are loans that small and medium companies can contract to finance their operations. Although they receive this name, in reality SMEs can get both loans for companies and lines of credit, as well as other financing products designed to cover more specific needs (advances of invoices, discounts of promissory notes, etc).
Business loans are used to finance all types of business needs, whether tangible or intangible. These loans are repayable monthly or quarterly and are generally granted over periods of 2 to 7 years, depending on the type of object to be financed. Interest rates can be fixed, variable, indexed or regulated.
Corporate loans (or loans to companies or loans to entrepreneurs) are the operations by which the company, the company, the entrepreneur, the artisan obtains the means necessary for carrying out his business.
Funding comes from various sources and is divided into:
• risk capital financing: equity capital
• financing of credit capital: capital of third parties
Equity Capital Loans
The company's loans made by way of own capital concern the individual entrepreneur or company shareholders and are:
• contributions made by the owner or by the company's associates at the time of establishment of the company (initial contributions) or increase in own capital (subsequent contributions). These contributions can be in cash or in goods (buildings, land, securities, vehicles, ...).
• profits obtained with the management of the company, not taken from the owner and not distributed to the members.
Third Party Capital Loans
It is the company's funding obtained from third parties, such as banks, suppliers, institutions, which have confidence in the repayment and payment capacity of the company, for which they grant credit.
Depending on the maturity, third-party financing is divided into:
• short-term payables: duration less than 1 year;
• medium-term debts: duration exceeding 1 year and less than 5 years;
• long-term debts: duration exceeding 5 years.
Depending on the nature of the transaction, third-party loans are divided into:
• settlement debts (or trade payables or supply payables): when the company purchases goods or services with more or less short payment terms.
• financing debts (or financial debts or loans): these are loans with which lenders (banks, financial institutions, other bodies) provide the company with the monetary means it needs. Their ignition involves an entry of money, their extinction an exit of money.
Granting Loans to other companies
The company, as well as receiving funding, can also grant loans to other companies (so-called investment) as equity (holdings in other companies) and as loans (loans). In this case, the loan is requested directly from a bank or finance company, which will provide to instruct the case, assess whether the requisites of legitimacy and merit are met and, if successful, the sum of money will be paid.
And for the workers, the assignment of the fifth
A special category of loans is the so-called transfer of the fifth salary. Holders of a public or private employment contract and pensioners can light a loan without collateral. The reimbursement takes place automatically, allowing the lender to draw monthly up to one fifth of the salary. The sale of the fifth is a non-finalized loan, characterized by a repayment schedule in constant installments.
Depending on the operation that originates the loans to companies, the credits are divided into:
• settlement credits (or trade receivables or supply credits), when the company sells goods or services with postponed payment.
• Receivables financing (or financial credits or loans) are loans with other companies monetary tools they need for their business.