Why Small Business Owners Are Using Debt Free Financing

Why Small Business Owners Are Using Debt Free Financing

Starting and maintaining a small business takes capital for everything from meeting payroll, to buying supplies and being able to fill customer orders. The downside to this is that banks and other traditional lending channels are reluctant to provide the capital needed to sustain and grow a small business. Fortunately, there are a number of debt free financing programs available to small business owners which go above and beyond what banks can offer, without placing a strain on finances.

A Sea Of Red Tape

Small business owners usually need access to funds quickly, to order supplies, cover the costs of an unusually large order, expansion, to acquire new equipment, and many other reasons. Traditional lenders, on the other hand, work on their own schedule, and have a rigid hierarchy to process loan requests. Furthermore, banks require a solid history of financials and impeccable credit ratings before they will even consider loan requests. Ultimately, even if the request is approved and a loan is secured, a business has to deal with compromised credit ratings and debt which can remain on the balance sheets for years.

Enter Debt Free Financing

Debt free financing comes from commercial lenders – many of whom were very successful small business owners before transitioning to the world of finance. These lenders understand the challenges facing entrepreneurs, and how time-sensitive the need for capital can be. Debt free financing is designed to provide working capital without placing a strain on cash flow, in order to allow small business owners to grow their companies. In some cases, debt free financing is structured around the value of equipment, property, and receivables. In other cases, financing is ultimately paid for by customers, and rolled into the invoices.

Examples Of Debt Free Financing

These financing programs come in many forms. For example, factoring monetizes open invoices to get businesses the revenue they are owed much faster than waiting on payments from customers. Merchant cash advances provide an infusion of working capital without placing debt on the balance sheets. Purchase order financing is an advance in funding used to cover large orders so small business owners can carve out a larger market share. Asset-based lines of credit provide a revolving source of capital based around the value of property owned by a business. There are also many more variations of debt free financing designed to help small business owners succeed in a competitive economic landscape.

How Small Business Owners Can Learn More

If you would like to preserve your company’s credit ratings and avoid placing debt on the balance sheets, while simultaneously getting the funding your need quickly and efficiently, call Vantage Commercial Capital at 913-543-4242. We pride ourselves on being able to provide affordable financing solutions to new and small business owners across every industry.