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Top Sources of Credit for Small Businesses

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Small businesses require capital to get off the ground and become larger businesses. Much of this capital will initially come from credit. There are various credit options available to small business owners, each of which has its own pros and cons.

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Top Sources of Credit for Small Businesses

  1. 1. Ahmed Dahab Business SMALL BUSINESSES Top Sources of Credit for
  2. 2. Ahmed Dahab Top Sources of Credit for Small Businesses Small businesses require capital to get off the ground and become larg- er businesses. Much of this capital will initially come from credit. There are various credit options available to small business owners, each of which has its own pros and cons. Invoice Finance Invoice financing can help plug gaps in cash flow in businesses where cus- tomers typically take a long time to pay. Lenders provide immediate cap- ital based on money due to the busi- ness, charging a relatively small fee for the loan. Business Loans Business loans are medium- to long- term sources of finance and can be a good solution providing the repay- ment terms are affordable. Although borrowers will be required to pay in- terest on the sum borrowed, the key advantage is that they won’t have to sell equity in their business. Business Overdrafts A business overdraft can act as a buf- fer for times when cash flow is poor, allowing businesses to spend more money than they have in their account up to a specified amount. However, overdrafts should not be considered a permanent source of finance. " Small businesses require capital to get off the ground and become larger businesses. Much of this capital will initially come from credit.
  3. 3. Ahmed Dahab
  4. 4. You can learn about the 5 C’s of business credit by visiting the blog of Ahmed Dahab.

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