Banks are "traditional" financing institutions... But what about your other options? Learn more about how alternative lending can help you get the funds you need.

1. The Definitive Guide
to Alternative Lending

2. What is Alternative Lending?
You know banks as the traditional financing institutions.
Alternative Lending is lending that takes place outside
of a banking institution, consisting mostly of non-bank
companies that provide funding to small businesses.
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What does the industry look like?
Let’s take a look at the numbers:
The approval rating
from alternative lenders is
61% - 64%.
Big banks have a
13% - 20%
rating on average.
Alternative lending
is an growing fast:
approx. $3 billion
in 2013 was lent through
alternative channels
(double that of 2012).
Benefits of alternative
lenders include:
less paperwork,
more flexibility,
faster funding.

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A Few Examples of Alternative Lending:
Microfinance lenders
and institutions
Pawnshops
Money orders
and money transfers you
make outside of a bank
Door-to-door money
lending services
Payday loans

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Advantages of lending online:
Online alternative lenders use complex algorithms,
software and all sorts of other non-traditional
sources to scan your business’s financials.

6. Who could benefit from
Alternative Lending?
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Previously Bankable
Business Owners
Banks raised the criteria
for business owners who could
qualify for their financing,
leaving them no chance
to turn for extra capital.
Previously Unqualified
Business Owners
Alternative lenders
also cater to borrowers
who wouldn’t
have been eligible for
a bank loan.
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7. The Advantages of Alternative Lending
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Speed & Ease of Application
Applying for a business loan
can take as little as 30 minutes
Quick Turnaround Time
Whereas banks can take
a few weeks, to get back
to you about your financing,
alternative lenders will often
send you their decisions
in a matter of days,
sometimes even within hours.
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Speed, efficiency, and diversity of offerings can make
a big difference. Here’s a list of reasons why:

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Flexible Underwriting
Alternative lending lets small
business owners grow their
companies in ways they
couldn’t when bank lending
was the only choice.
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Diversity of Loans
Alternative lenders will let you get paid for your
outstanding invoices upfront, order a bundle
of business credit cards, crowdfund your idea,
or go for the classic solutions such as term loan.
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9. The Disadvantages of
Alternative Lending
Considering whether it’s for you?
Consider those potential negatives:
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Shorter Terms &
Smaller Amounts
Depending on the products
you qualify for, alternative
loans might have shorter
terms in most cases.
More Expensive
Comparing traditional
financing with
a short-term loan,
the price tag difference
is a big one.
More Frequent
Repayments
Plan ahead carefully -
many loans given
by alternative lenders
have weekly or daily
repayment schedules.
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10. Kinds of Funding you can get from
Alternative Lending:
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Term Loan
Loans with a set repayment time, a set number of payments,
and a fixed/variable interest rate.
Equipment Loans
These let you finance up to 100% of the value of the equipment
for your business, making it act as a collateral.
This way lender cares more about its value
rather than your credit history.
Lines of Credit
A business line of credit allows you to draw funds when you need,
pay them back, and take out more later on.

11. Invoice Financing
This form gives you an advance on the money
you’re already owed, so you don’t have to wait for your clients
to pay you before you can cover your own bills
Startup Loans
A broad category of alternative lending – different lenders have their
own kinds of loans for new businesses without any history.
Merchant Cash Advances
This solution is tailored for those processing credit cards, giving
an advance that’s paid back with a percentage of your daily transactions.
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12. Getting Started
Small business lending marketplaces like Fundera
make it possible to get several offers
with a single application.
We keep it simply by delivering you trusted best-fitting
options from the most trustes lenders
in the industry.
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