What is Alternative Lending?
Alternative lending is a set of various financial solutions that are done by financial companies that are not banks. Alternative lending offers small businesses the chance to get the financing they need to complete every day expenses like payroll, rent, supplies, maintenance, and more.
It’s no secret that small businesses tend to have a hard time getting approved from big banks. There are a lot of restrictions that come along with getting a loan from a bank and many of those restrictions effect startups.
Alternative funding lenders offer perks such flexibility, faster funding, short approval periods, less paperwork, and more.
What is the Cost of Alternative Lending?
Since alternative lenders do take a risk when they agree to a deal with a small business, the cost of lending is slightly higher than a traditional bank. Understandably so, this is to cover the risk being taken and the speed of funding. Every alternative lending service is different. In certain situations, a business can be processed, approved, and funded all within 24-hours. For a small business owner in financial distress, this is a dream come true. We all know that nothing is free, and businesses who really are in need of immediate funds are willing to pay the slightly higher price in order to keep themselves in business.
Types of Alternative Lending
Why is Alternative Lending Better Than Traditional?
Alternative lending is a better option than traditional because it allows businesses to get the fast funds they need in crunch situations. When your business needs money, it needs it right away, right?
There is no time to waste when situations arise that are out of a business’ control. Alternative lending companies understand this and work as fast as possible to get your business financially stable.
One of the best things about alternative lending is that your business can get approved and funded without you ever having to leave the office. Alternative lending companies have skilled programs and processes that can get your business approved very quickly. All that is needed from you are some important documents regarding your business and those are scanned and checked into a system.
Find a Factoring Company
Many times, alternative lending companies offer online applications that can be completed before you even have an introduction to your lender. This is a great thing to have completed as soon as possible. This way, the lender can get started on getting you approved. The online lending system is the easiest and most effective process for companies that need more money each month.
Traditional lending from banks is almost non-existent for small businesses these days. Big banks have stepped away from small business lending because it is a bigger risk with a smaller pay off. In fact, they even changed the requirements needed to be approved for a business loan, making it harder for small businesses to even have a chance.
Alternative lenders saw this as an advance and have scooped up all the lending opportunities they can get, big or small. Business Insider estimates that small business lenders originated $52 billion and will increase 20.7% by 2020. With that being sad, alternative lending isn’t going anywhere!
Get Approved Today. See Growth Tomorrow.
Opportunity is knocking. Will you answer?