Women are breaking the stereotypes and making a name in every field, be it sports or business. They are trying to establish themselves without taking the help of men. There are many women who have scripted their success stories. Today, many women are trying to break into the business world with innovative business ideas. There are many lenders and financial institutions who are giving a helping hand to the women by offering them with the business loans to run the business or expand their existing business. There is no idea that can be expanded without capital. All you need is to have money to bring your idea into reality. You no more need to wait for the investors to invest in your business. There will be a few investors who would be gender biased. The best option that is available for women to prove their spirit is to take business loans.
There are a few loan schemes that are exclusively designed for women with lesser interest rate and flexible payment options. More importantly, the processing fee of the loan is also very less. They do not need to pledge any asset as a security. The loan repayment tenures will be long. The different types of business loans that are offered to be women include:
Working capital term loans:
This is a type of loan that is required for women to meet their immediate financial needs. However, this is not used to make investments or buy assets. This type of loan will make sure that you can meet the expenses such as rent of the company; wages for the employees, etc. until the client clears your due amount. This comes handy for you to carry out your day to day business operations without any hindrance.
Working capital demand loans:
This is also known as revolving working capital loans. This type of loan will be funded capital to the business to carry out its day to day operations. This type of loan is simple to avail and is highly flexible. More importantly, this is alike to that of the business line of credit. When you take this loan, you need to repay the loan amount in a timely manner. This is best for the business that has cash flow. This allows the business owner to withdraw the amount when in need and repay back the loan amount for the withdrawn cash on time.
Secured term loans:
This is the type of loan where the borrower has to put an asset as collateral with the lender or financial institution. When the borrowers fail to pay the amount, the lender possesses every right to sell the asset and recover the loan amount. The borrowing limit that is provided by this type of loan is pretty high. The interest rates would be less compared to the unsecured business loans. You also have an option for flexible repayment, since you have pledged an asset as collateral therefore the lender would not be at risk. This type of loan is used to buy buildings, lands, get renovation work done and for construction.
Project and acquisition financing:
These types of loans are taken by women to expand the business. The business owner has to project the cash flow of the business and the balance sheets of the projects to the lenders. Even this type of loans is secured, since the project assets would be used as collateral by the banks. This is the widely availed by the women entrepreneurs when are planning to expand the business.
If the woman is a medical practitioner and would like to start her own clinic or a diagnostic center, then she can avail this loan and get the money sanctioned to buy the equipment that is required to run a clinic or a diagnostic center. She can use the money to buy CT scanners, X ray machines, MRI machines, sonography and other medical equipment.
Every factor would need machinery to produce the products by utilizing very minimum resources such as power, manpower and installation expenses. If you want to start a manufacturing business of a product or a machine, you would need the appropriate machines to make the products ready. You can avail the machinery loan to buy the machines required to run the business. When you buy the machine, then the machine would be put as collateral by the lending companies.
The above are a few types of loans that are given to the women entrepreneurs to start their own business and flourish. Women entrepreneurs in the market are giving a fierce competition to their male counterparts in various industries. Every business owner needs funds to run the business and it is important for the women entrepreneur to be aware of the different types of business loans that are given to them by the lending companies and financial institutions so that they can apply for the loan and get the amount sanctioned briskly.