Business loans

Nowadays, financial institutions have impact on the economic situation in each country. The easier access to financial stimulations is really important in the current situation of crisis. To increase the development levels of each economy it is necessary for businesses to grow permanently. Bank loans are diverse because of the various market needs.

Basically, business loans include two principle groups: for investing and for working capital. The first one helps companies to gain lasting tangible and intangible assets. Business loansThe second one helps companies cover their expenditures.

There are several types of business loans that are more specialized. Credit for start-ups is focused on granting money to this type of companies. In Bulgaria this financing is still not deeply developed. Financing through European Union programs, or a combination of public and bank financing are used more.

Loans for supply and distribution are a very specialized type as well. Usually, these credits are overdrafts and help maintaining the company activity.

Micro lending is appropriate for small and medium enterprises or people with liberal professions. Its size does not exceed 50 000 euro and the interest rate is within 10 and 15 per cent.

Loans for agriculture and food industry are the next type of specialized loans. They are dedicated to private farmers, producers and merchants of cereal products, agriculture cooperatives and leaseholders.

Credits in the field of tourism are broadly used. Banks subsidize all levels of different projects: purchasing, construction, renovation, redecoration, modernization, etc.

There are credits with the main purpose of helping the activity of physicists, pharmacists, dentists and hospitals to become more developed.

There are many advantages to business loans. The bank policy about these types of loans is different from the policy about individuals. Business loans conditions could be negotiated. Bank officers strive to maintain the bank’s needs and fulfill clients’ wishes simultaneously. By receiving this type of credit the companies affirm their market status. It is not an easy task to receive corporate credit. There are a lot of high requirements and the procedure of receiving approval is long and difficult to get through. However, companies that receive this financing have enough security and guarantees.

Business loans are overspread because their help for businesses is needed. So, the relation between financial institutions and business is strong and permanent.

Comments are closed.