Finding capital for your growing business has become harder and harder over the years. With the recent recession and so many banks going bankrupt, a loan is like a needle in a haystack. It is good to know that there are alternatives when is comes to securing funding. Accounts receivables financing and peer-to-peer lending are two great avenues you may want to explore.
Accounts receivables financing helps small and medium size business gain access to quick capital. This is when business owners sell there invoices at a discount to investors. The process usually takes 1-3 days so, you can have the money you need fast. There are two ways you can go about selling your outstanding accounts, sell to a factoring company or auction them in a marketplace to investors. Many business owner opted to auction there invoices themselves, it gives them more control of the amount of discount they are willing to give. There are also banks that offer factoring services, but usually takes a little longer and involves more legal work.
Peer-to-peer lending networks are exactly that, you borrow from someone with the funds to invest instead of a bank. There are a few sites on-line that offer this service and you can easily find one with a quick search in Google. Like a bank you borrow a certain amount and pay it back with interest on a set schedule. The amount you are able to borrow is based on your credit score just like borrowing from a bank. The interest is also based on how much of a risk you are and are much lower for those with higher credit scores.
These are both great ways to secure capital for your business when you need it. Do your research and make sure you have a full understanding before you make the plunge.