Nowadays, getting financing for the business is almost mission impossible. Banks have been running the credit for years for small businesses and self-employed people. Their excuse is that “they do not ask for loans”, but the reality is that most businesses have grown tired of receiving NO as a response when requesting financing for their companies. So they have looked for alternative financial solutions through credit institutions. And one of the ways to finance these companies are microcredits for companies. If you still do not know what microcredit is or why use it to finance your business, here are ten questions and answers that will get you out of doubt:
Questions about microcredits for companies
What is a microcredit?
They are quick loans of little money, for example 300 euros, which are offered with advantageous conditions, even with Financial Credit Institutions, and even with a lower interest rate than a traditional bank loan.
Who can get a microcredit?
These small loans are aimed at companies and freelancers who have difficulties in obtaining financing. Either to start your business or to maintain it. Sometimes it is due to problems with your financial history, to be included in delinquent files such as asnef, or the accumulated losses of your business.
What requirements do you require to apply for a microcredit?
They can vary depending on the entity but they are usually much less than to apply for traditional bank financing. The great advantage of almost no requests for pawns is that the mini-credits become a quick way to get money to meet small incidentals or mismatches and treasury of the company. Normally with the name and surname or company name, and the company ID or CIF, you can request mini-credits. Logically, if we request more than 500 euros, it may be necessary to provide more information.
How much money can you give me with a microcredit?
Normally, a microcredit is usually for amounts less than 1000 euros and the repayment term does not exceed 30 days. In those cases you can get money quickly and easily without much paperwork. For financing cases for companies that need more than 1000 euros may have to resort to personal loans.
What is the applicable interest rate?
It depends a lot on the entity so it is essential to have a credit comparison https: //prestamos-personales.Forsyte family.com/ that allows you to filter and order the best offers quickly and easily. Some entities offer microcredits without interest, simply in exchange for a commission of study or opening. And others charge high interest that can exceed 10% per month. That is why it is fundamental to know how to filter the wide existing offer.
What is the return period?
Given that the risk assumed by the lender is high, because it provides financing for companies that are not very solvent, the average repayment period usually does not exceed 30 days. Remember that it is a source of external financing that should only be used for specific needs of money, not to cover permanent cash deficits or structural liquidity problems.
What are the most common causes to apply for a microcredit?
According to recent studies prepared by credit institutions and banks, the main reasons for companies to apply for a microcredit are:
- Finance contingencies (39.9 percent)
- Payment of current expenses (31.8 percent)
- Entrepreneurship (18.9 percent)
Do I need a guarantee to approve the request for the microcredit?
Having a guarantee is one of the biggest obstacles for most companies. Businesses that need financing and that see how the banks ask for guarantees from the owners or partners to get small amounts of money and in bad conditions. However, in the case of mini-credits, this is not usually the case. Unless the applicant of the financing has a history of defaults or is included in files of defaulters such as Financial Credit Institutions. In these cases, the granting of the mini-credit may be conditioned on the endorsement of a person, whether autonomous or a company, more solvent and with a better financial record.
Is there any way to get a microcredit without putting the banks in the middle?
Yes, in fact it is the most usual way. There are many entities specialized in microcredits for companies and individuals that operate in Spain.