Small businesses face a huge shortfall in the funding as they originally had limited funding sources till now. They had very few sources to raise funds for the long term as well as the short-term business loans, they had to either reach out to the local lenders who charged an astronomical interest rate that often did away with all their profits. Or, they had to reach out to friends and family which often resulted in bad relationships. Eventually, the only option they were left with was to reach out to the traditional lenders.
The traditional lenders required collaterals like home or office properties to be pledged against the loan requirements and also took a really long time to process the business loans, which was often a few weeks or even months, that made the small businesses suffer.
This is where the digital lenders came into the picture as they started offering unsecured business loans, which did not need any collaterals and were based on their own business transactions. Also, they offered quick loans for both long term and short term business loan requirements.
Let us have a look at some key reasons which make the unsecured business loans safe for small businesses:
- No Collaterals
What makes the unsecured business loans really safe is the fact that the small businesses are not required to provide any collaterals like an office or home properties. Since most small businesses operate out of a rented premise it becomes really tough for them to get funding for their growth. Unsecured business loans help them to get both long term and short term business loans based on their business transactions. A Retail store can get the unsecured business loans against the card swipe machine transactions, a restaurant can get the unsecured business loans against the transactions with the food delivery apps and so on.
- Quick Turnaround
While a lot of times, small businesses need instant funds to cover the short term working capital gaps. However, the traditional lenders take a long time to process the short term business loans, it might take a few weeks or even months to get the same, which makes it useless for the small businesses to even apply for the short term business loans. The digital lenders like Indifi help the small businesses with a quick and simple online application process for short term business loans that helps the small businesses to cover their immediate shortfalls and work towards their growth. The hotels might need the short term business loans to cover for a lean period and the e-commerce sellers might need it for ordering goods in bulk for the upcoming sale and so on.
- Covers Specific Requirements
The small businesses have specific requirements which need special purpose unsecured business loans and the standard business loans offered by the traditional lenders do not fit the bill on most occasions. For example, a travel agent needs to pay immediately to the airlines for their bookings. However, they get their payments from the clients within 5-6 days. Thus, the top digital lender Indifi offers a special 7-day short term business loan for the travel agents that gets transferred directly to the account of aggregators which not just saves time but solves a specific need that can’t be solved by the traditional loans with equated monthly instalments.
- Repayments as per Business
The small businesses run through various business cycles and patterns which makes it difficult for them to pay the same amount of instalments every month to the lenders. The unsecured business loans offered by the top digital lenders like Indifi offer complete flexibility on repayments to help the small business repay their business loans with ease and comfort. The retail shop owners or the restaurants, for example, have the flexibility to link their repayments to the transactions, which ensures that a very small amount gets deducted from every consumer transaction that takes place against the unsecured business loan repayments, while it is a small amount, it helps the small businesses as the loan gets repaid on its own without having to worry about the repayments.
- Improved Credit Scores
The ease of repayments also helps the small businesses with an improved credit score as they do not have to face the problems of bounced EMIs and late payments which degrades their credit profile.
The unsecured business loans offered by the top digital lenders like Indifi thus are completely safe and help the small businesses to fulfil their growth aspirations.