Is it Right to Take a Startup Bank Loan?
by Finway FSC Empowering People FinanciallyIt is a known fact that for any business, capital plays
an important role. The startup business usually avails small business startup loan to overcome various expenses like the
location of the business, furnishing, equipment, and furnishing. While it may
sound that taking a loan is a good idea, there are so many things that will up
come when you are availing a loan.
Mark Cuban once said that only "Morons start a
business on loan". While this statement sounds a little harsh, it has a
great hidden meaning. If you avail a bank loan for starting any business, you
have to start repaying the EMI from the preceding month only. You will be under
huge financial pressure from the first month itself. This is not right for the
business. But as it is impossible to start any business without capital, you
have to get the business
loan.
Before even applying for a startup loan for new business, make sure that you are dedicated and
will make this business a success. You have to treat the bank money as yours
and put in a lot of efforts to make use of it as efficiently as possible.
Here are some of the questions that you have to ask
yourself before you go for a small business loan.
·
Are you eligible to get the bank loan? Is
your financial record sound enough to get you the bank loan?
·
If any bank rejects your loan application
or if you are not qualified according to the bank standards, your credit score
will be affected.
·
The loan that you take should generate more
revenue. If you take a loan and it isn't able to bring in more revenue for your
organization, you will get stuck with repaying the loan from your own pocket.
So make sure to have a business plan that is capable of generating revenue on
an immediate basis. You should be able to repay the loan amount without any
hassle, and there shouldn't be any future requirement for you to borrow a loan.
·
If you are a startup, it won't be easy for
you to get a loan from the public bank. If you go with a private bank, you
should have collateral security as a backup.
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Created on May 6th 2019 04:34. Viewed 337 times.