1. Small Business Loans: Basic Necessity of a Business Enterprise
Summary – It is not possible for a Business organization to function without working
capital. Fund flow to an enterprise in the form of loans is necessary for its growth and
sustenance. So, business owners should prepare themselves well before filing loan
applications.
Making a decision to start a self-owned business is great. But then one has to look for
ways to make it happen. Starting a new enterprise is easier said than done. The first thing
that one has to look forward to is a financial market where the entrepreneur has to seek
for loans. Then there are other criteria like a good business plan that is workable.
Lenders look for something in borrowers that sounds normal to them so that they can
extend small business loans. The amount that lenders grant to a business enterprise
depends on the repaying capacity of the applicant, their credit scores and a credible
record. Greater amount of grants gets credited to accounts incase businesses pledge their
assets as collateral. However, if this is not the case, and businesses offer other forms of
guarantee then they have to prove themselves to be credible enough.
It is not always easy for start-ups to pledge their hard earned assets for credits. Also, it is
not possible to run an enterprise without working capital and that normally comes
through loan support. So, entrepreneurs need to prepare from the beginning before they
set out to start a business. Preparation starts with making of a sound Business plan and
approaching agencies to draft credit reports. Such steps help to make good credit scores
for an organization and then it can easily make a place for itself in the eyes of the lender.
With approval of small business loans, it becomes possible for an entrepreneur to make
a beginning and eventually grow in business. But it has to be proof itself trustworthy and
win the confidence of lenders. Once this happens then there is no restrain and an
enterprise can keep on finding grants even in the future.
Most often, lenders are found to keep the application process simple and with furnishing
of basic documents, loans are credited to one’s account in a short duration. The
application process has been streamlined by financers with minimal paperwork and
affordable repayment terms.
Business owners just have to maintain a good credit history right from the start and then
it can be possible for them to find private lenders too other than only banks. It is just their
credible history of timely loan-repayment that will bring funds to their organization from
any source. An entrepreneur has to take care of this as without sufficient credit, it is not
possible for an enterprise to sustain and grow in today’s world. So, it is in their interest
that they keep a sound track record.
There are certain details that borrowers need to submit along with applications for loans.
The details include Business plan, financial statements if any, account receivables and

2. account payables. A company owner should only ask for that much fund as is required for
the time being. Thus, it is necessary to accurately assess the requirements of the company
and based on such assessments, applications for funds should be filed. While making
applications, the borrower should do it in a way that it meets lender’s document
requirements and expectations.