Ever since the recession of 2008, banks have battened down the hatches on offering traditional loans to small business. In an already difficult economy, being declined for a bank loan put many small businesses in precarious positions. Where else can you go for funding to keep your cash flow positive?
Enter the rise of alternative financing, such as invoice factoring or Working Capital Advances. When banks closed their doors to supporting small to medium businesses, this left a large growing market in need of small or short-term loans. Alternative financing entered the playing field with creative solutions to make sure small businesses get a fighting chance. After all, the death of small, local businesses benefits nobody. A healthy balance of small, medium, and large businesses is needed for a thriving economy.
As many more businesses are jumping on the alternative financing train, we’ve found four main reasons business owners are choosing new and improved financing options, such as invoice factoring or Working Capital Advances, versus traditional bank loans.
1. Banks Are Tightening Up on Business Loans
As mentioned above, banks are making it more and more difficult for small businesses to secure loans. After jumping through hoops and patiently waiting in hopes for approval, many companies are faced with the red ink stamp of a loan declined. This alone has forced businesses to get creative with financing if they want to grow. Alternative financing emerged as a solution for many small businesses that couldn’t be supported by their local neighborhood banks.
2. Need Access to Small, Short-Term Loans
Small businesses that are growing and producing revenue don’t always need a hefty loan like larger businesses. Sometimes all they need are small, short-term loans to buy new equipment, make building improvements, or hire new staff to take their growth to the next level. Alternative financing offers more options for businesses needing a helping hand with smaller, short-terms loans without the hassle of securing big bank approval.
3. Need Fast Cash
The process to get an approval for a bank loan takes time and effort. But what happens if the bank declines you? That’s precious time and energy wasted. Alternative financing gives you a fast response and can put cash in your pocket as soon as the next day. Businesses have peace of mind knowing they can get the help they need without a long wait.
4. Interested in Innovative Solutions Online
Banks have been around for centuries, and though they won’t be going away anytime soon, alternative financing offers new, innovative solutions accessible from the comfort of your home or office. This means you’re not limited to local financing options or physically entering a building to secure a loan. You can go online, speak to friendly representatives, and gain approval faster than the ink can dry on a check. Online alternative financing solutions are the wave of the future and savvy business owners are catching on quick.
Are you tired of the hassle of trying to secure a bank loan? Do you need fast cash to help grow your business? At eCapital, we offer quick, simple funding solutions and the support you need to finance your business. Learn more by contacting us today about your financing options.