Through a loan, the bank lends the amount of money requested to the entrepreneur. This sum must be returned to the bank over a shorter or longer period, with the addition of accrued interest.
Who Is It For?
It is a solution dedicated to the needs of businesses, sole proprietorships and self-employed workers who need liquidity to grow their business. Getting a loan means being able to manage this credit in a targeted manner, investing in what you believe is the best for your business: from real estate to movable assets, from machinery to the human factor.
Purpose: Why Request Financing
A loan can be used when there is a need for a widespread investment in the company, but you do not have the necessary availability to deal with this investment. With a loan, business needs can be met such as the purchase of new plants, machinery, vehicles and equipment, the renovation of buildings, the adaptation of premises to safety laws, the costs of research and development programs, investments in advertising and purchase of patents.
How Does It Work
The credit obtained and invested in the growth of the company must be repaid in installments over time. The share of each of these installments, which may be fixed or variable based on the type of product chosen, is composed of a share of capital (repayment of part of the money lent by the bank) and a share of interest.
- The financing of a start-up can take place with different interlocutors, methods, implications and times, starting from needs and criticalities linked to the stage of development of the company.
- In the development phase of the project, research and development activities, market analysis, selection of collaborators, activity planning, etc. will be financed.
- The next step will be the financing of the so-called structural investments, aimed at productive capacity (equipment, plants, machinery, buildings) and those necessary to ensure business operations (activation of the commercial, administrative, etc. function).
- Once the needs have been quantified, the possible sources will have to be evaluated and chosen according to the activities, the costs and the amount of the financing. The costs and conditions of access will have to be carefully assessed in identifying the source.
The various phases of the company’s life correspond to different activities to be funded, needs to be faced and sources of funding available. You can click here to have a proper idea regarding this.
From a financial point of view, the start-up in the nascent phase often has some typical features:
The financial need arises from the need to continue research activities or feasibility studies, to develop software for the construction of technological platforms, to support out-of-pocket expenses to start the first activities in marketing and advertising: all intangible elements, difficult to evaluate for the lender external.In some public subsidized finance schemes a surety is required.