Getting a loan at a big bank is not an easy job. They require a lot of documentation and paperwork as well. Many times, individuals or business owners find they don’t fit in the criteria for money lending by the big banks. So, if you are not able to get the money at the big bank then where can you go.
Mostly the small business owners are in need of funding which they themselves are not able to get. Many big banks reject the startup businesses for loan due to their less credibility.
There are some alternatives to big bank lending where you can go for borrowing money. They are as follows:
- Online Money Lending
There are a lot of money lenders who work online. So, you can easily find them on the internet. Though there are other scammers as well who does that which in result can bring virus to your computer or phone. So, steer clear of these scammers. Get as much needed information about the online money lender as you can.
This way you won’t be scammed by them. Search for the genuine and reliable money lenders on the internet.
This is another one of the alternatives for big bank financing, but crowdfunding can be complicated. For example, if you are in need of $1000 then you can get small amount of money from different people till you reach $1000. Someone can give you $10, $30, $100, etc. you can do this manually as well as on the internet.
But not many people will give you money. So, this can take a lot of time for you to collect the money.
You can also ask your friends for the money you require. Many times, your friends can loan you money with the least amount of rate of interest or no rate of interest at all. Though sometimes if you are not able to pay off the loan for a long period of time then your relationship with your friend can go downhill as well.
This one if the most reliable alternative for big bank financing as well. You can get a long-term loan with minimum rate of interest from your friends as well.
- Angel Investors
If you are a small business owner then you can get an angel investor. An angel investor is an individual who invests in your business and becomes a silent partner in your business as well. These investors mostly invest in new start-up businesses at their initial stages. They help the business owners when no other investors want to help them.
- Startup Grants
There are some financial institutions or private firms who give grants to the new startup businesses. Your startup business should show some promising results so that they will give you the grant for it. A lot of startup businesses compete with each other for these grants.
So, these were the five alternatives for big bank financing. If you can’t get financial help from big bank then you can try these alternatives.