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When it comes to funding your small business, the question isn’t if you will need a cash injection, but rather, how and when. This is because additional funding provides enterprises of all sizes with the working capital they need to survive and thrive, whether that’s overcoming a seasonal slump or keeping up with rapid growth.
Not all small business funding options are created equally, however, and some simply don’t offer the flexibility many business owners require. Don’t fret, though. In this article, we’ve highlighted two of the most flexible finance options you need to know.
Unsecured Term Loans
Term loans are often what people think of when they imagine business funding, as this is the most common form of finance offered by traditional banks.
Term loans have the flexibility of having either short (3-12 months) or long (1 year+) fixed terms. So business owners can determine beforehand timeframe to pay back their borrowed funds, plus the accrued interest.
In the past, however, term loans were always secured, meaning they required the business owner to provide a form of collateral to ‘secure’ the loan. This could include their home, vehicle, or another valuable asset.
Furthermore, the lenders would take an applicant’s credit score into account. This meant that anyone with a lower credit rating could not obtain the funds they needed to run their business successfully.
While these business loans still exist today, there’s a much more flexible alternative – unsecured business loans. These are usually short-term loans that have minimum requirements focusing on the business’ duration of operation and minimum amount of monthly sales, rather than collateral or credit scores.
Here at Zinch, for example, we offer term loans that range from $10,000 to $250,000 for new clients, with a flexible duration of 3 to 12 months. Unlike some traditional term loan providers, there are no prepayment penalties, giving small business owners the flexibility to pay off their loan early if they wish.
Most importantly, business owners can get approved within 24 hours and receive funding in as little as 1-2 days. This fast turnaround caters to their needs much faster than traditional lenders, whose application processes can take multiple weeks to be processed.
Cash Advance
While a term loan appeals to those who like to know beforehand how much they need to pay back and when, a cash advance is ideal for business owners requiring a more flexible payment structure.
With a cash advance, payments are calculated as a percentage of your credit and debit card sales. This means if your sales go down (for whatever reason), your payments go down too, making it perfect for businesses with variable sales.
This small business funding option is available to businesses that receive a high number of credit card payments from their customers. This is because these advances are borrowed against the future credit card sales of a business. The lender is, therefore “advancing” the funds before they get paid.
The flexibility with a cash advance doesn’t just end there, though. It’s also one of the very few small business funding options that don’t focus on an applicant’s high credit rating or ability to provide collateral.
At Zinch, we also offer flexible cash advances to small businesses, and our only requirements are that a business has been in operation for at least 6 months with a minimum of $10,000 in monthly sales. These business loans offer the same fast approval period as term loans, and loan amounts also range from $10,000 to $250,000 for new clients with terms of 3 to 12 months.
With a term loan or cash advance, business owners can also enjoy the freedom to spend their funds on anything they choose – whether it’s equipment, staff wages, rent, product development, and more. This differs from some other types of business funding, like equipment financing for example, which requires the funds to be spent on business equipment only.
Ready to Get Funded?
There are multiple flexible small business funding options for your business, and what’s best for you will depend on your specific situation and unique needs. Thankfully, Zinch has the experience, know-how, speed, and customer service to help you get back on your feet and grow.
Contact us at (714) 500-6622 to learn more about your small business fudning options. You could qualify for up to $250,000 in just 24 hours.
