Problems when financing your incorrectly
In Mexico, almost 99% of the businesses that exist are considered SMEs (small and medium enterprises). But something interesting about these, is that in order to grow they need financing.
Commonly entrepreneurs and owners of SMEs finance their businesses with personal loans. This leads them to generate debts or enlarge those they already have.
The most common problems that exist when financing your projects with personal credit are the following:
The amount that a credit card can offer you is not enough for what your SME requires. Your business needs a bigger credit. For example, if you have a restaurant and you are about to expand, the costs range from permits to interior design and you would need to use more than one card.
Credit cards are designed for personal purchases that you can end up paying in a shorter term, but offer very high interest rates. That’s how you can get to over-indebtedness since you’ll be paying up to 50% more interest.
Your credit history and score are essential when requesting financing. This is information that occupies the institutions to be able to grant you a loan.
Online loans for SMEs are designed to help you strengthen your business. Through the way they analyze your information, offers are made that can benefit your projects. Payments are defined with your business’ billing and credit history.
And if you have a positive experience and your business is achieving more goals, you may be able to be creditor to better offers with larger amounts.
If you have financed your business with personal loans, today there is a possibility that you can transfer your debts to business loans.
At Konfío we have developed a product that concentrates all your debts into one, free your credit lines and improve your credit bureau. Financing for business is especially designed for them, resorting to the right credit.