As you know that different types of loans has different purposes, hence they will also serve different purposes in businesses. Typically the rates differs from a few percent a year to 30% per annum.
Hence, below are the rates generally offered by Banks and Financial Institutes for the 5 most common financing methods, rates may also vary due to promotion packages as well as companies' relationship with the loan provider.
1. Asset-backed(property) financing - This is a popular option amongst business owners as they tend to be able to get larger quantum with lower interest even for new companies, from 6% per annum up to 10 years
2. Working Capital/Business Term Loan - A common financing taken up by businesses, this loan allows them to borrow from banks without any collactoral with interest as low as 6.5% up to 5 years
3. Purchase Financing - Financing for purchases is a method many companies are adopting now, as companies tend to require the capital to purchase goods first. However this will be dependent on what are the purchases, and how soon they could be turned into income, interest rates from 7% per annum
4. Contract/Invoice Financing - Companies which uses this financing method tend to have on-going projects which are recurring and have long payment terms(30 days and above) to get addition capital to acquire more projects, as the loan quantum is dependent on the contract/invoice value, with interest from 1% per month
5. Private Funding - With all options out of sight, this is usually the last on the list due to the interest rates, however they are able to take on riskier cases which acts as a bridging loan for companies to tide over their current stage. Rates are from 3% per month for up to 6 months
Apart from the above, there are various different financing methods available as well, with each method suited for every other businesses, interest rates and tenure of loan also differs from each Banks/Financial institutions.
With our service, we will assist in achieving the most suitable financing method for you dependent on your companies' profiles, aiming for the lowest interest.
Focus on building your business, leave your financing woes to us by contacting us here.
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