• HOME
Log In
May 30, 2023
  • Home
  • Contact Us

User Panel Banner
Log In

  • Home
  • Business
  • Finance
  • Branding
  • Sales
  • Marketing
HomeBusinessReasons Your Small business Cannot Get Funding ...

Reasons Your Small business Cannot Get Funding – What you Can Do

  • February 27, 2020
  • 0 comments
  • Craig Fischer
  • Posted in Business
  • 0
0
SHARES
FacebookTwitterGooglePinterest
RedditTumblr

One of the leading causes of the failure of small businesses is the lack of capital. For your small business to run smoothly, you need to have enough money. You will have to purchase inventory, hire employees and expand your business. Small business owners find it hard to acquire credit facilities. It makes it challenging for a business to survive. There are many reasons why a financial institution may deny your small business funding.

Economic concern

When a bank lends money to a business, it must get it back within the agreed period. However, that can be hard when there are tough economic times. Banks will refrain from lending to small businesses because it will be hard for such companies to pay back the money on time.

Insufficient collateral

Small businesses do not have enough assets that can be used as collateral to obtain financing. Most of the financial institutions require insurance before completing the transaction.

Inexperienced management

A robust top-level leadership also increases the chance of a business to get loans. A good leadership team will lead to the long term success of a business.

Insufficient credit

When you are just starting, you will not have any credit score. You have to keep doing business to increase your credit score. Most of the financial institutions have increased their credit score standards. Small businesses generally do not have the required credit score. For a business to qualify for a bank loan, they will need a credit score of at least 720. That score can be be unreachable for small businesses especially when they are still new.

Insufficient operation history

Most banks give priority to businesses that have a long track record. Banks require stable track record profits for a specific time. Without an operating history of a significant period of time, the loan request for a small business is likely to be denied.

Personal guarantees

Business owners are required to provide personal guarantees to get a loan. The owner has to be personally liable when it comes to paying back the mortgage. It can be difficult, especially for those who are still struggling to keep up with their business expense every month.

Lack of consistent cash flow

Your cash flow will determine whether you get the loan or not. Financial institutions prefer a business with steady cash flows. It will be hard for a small business to show the required consistency in cash flow.

These are just some of the reasons why it is hard for your small business to get the funds it needs. Luckily, there is something you can do to access credit from a financial institution.

What do you do when a financial institution declines your request for a loan? One of the ways is by purchasing a shelf corporation. Make sure you buy an aged corporation, so it increases your chances of getting funding. Do your due diligence when purchasing the aged corporations for sale to avoid getting scammed. The best shelf company is one that does not have any pending liabilities.

Craig Fischer
Craig Fischer

Related Posts

Shared Office Space Agreements 101: What You Need to Know Before Signing
0 comments
Business

Shared Office Space Agreements 101: What You Need to Know Before Signing

buying TikTok views
0 comments
Business

Role of TikTok views in your social media marketing plan

0 comments
Business

10 Ways Restaurants Can Improve Their Point-of-Sale Experience for Customers

5 Advantages of Starting Home Business

  • February 26, 2020
  • 0 comments

The Art Of Displaying Right

  • February 28, 2020
  • 0 comments

Share this

0
SHARES
FacebookTwitterGooglePinterest
RedditTumblr

Related Posts

Shared Office Space Agreements 101: What You Need to Know Before Signing
0 comments
Business

Shared Office Space Agreements 101: What You Need to Know Before Signing

buying TikTok views
0 comments
Business

Role of TikTok views in your social media marketing plan

0 comments
Business

10 Ways Restaurants Can Improve Their Point-of-Sale Experience for Customers

0 comments
Business

7 Strategies for Optimising Payroll Accounting to Drive Business Growth

Do not miss

Shared Office Space Agreements 101: What You Need to Know Before Signing
0 comments
Business

Shared Office Space Agreements 101: What You Need to Know Before Signing

gallery+10 Items

TOP POSTS

Shared Office Space Agreements 101: What You Need to Know Before Signing
0 comments
Business

Shared Office Space Agreements 101: What You Need to Know Be...

  • May 17, 2023
  • 0
  • 7
buying TikTok views

Role of TikTok views in your social media marketing plan

  • May 6, 2023
  • 0
  • 19

Why Is It Important to Support Local Farmers?

  • May 1, 2023
  • 0
  • 6
Patient Navigation

TradingView Alerts: How to Set Them Up and Make Them Work fo...

  • April 29, 2023
  • 0
  • 6
gallery+10 Items
The key to victory is discipline, and that means a well made bed. You will practice until you can make your bed in your sleep.

REcent post

buying TikTok views
Business

Role of TikTok views in your social media marketin...

  • May 6, 2023
  • 19

HOT POSTS

1

The Boom in Transcription...

  • February 4, 2020
  • 0
  • 67
2

Safety measurement measur...

  • May 14, 2020
  • 0
  • 55
3

8 Tips to Help You Make i...

  • September 22, 2020
  • 0
  • 217
Copyright @ 2023 officeosetup.com | All Right Reserved. Disable responsivity