Which Finance Companies Should Approach for Small Business Loans?

Ashika Group

Internet Trading | August 26

Financing their own small business is the dream of every entrepreneur, but funds are hard to be raised. In the absence of own capital, it can be very difficult to set up even a small venture. Trade finance companies exist precisely for this reason — to help out people get funds more easily and start their business with ease. These are the cornerstones of the financial market, and offer loans to start ventures in different industry types. You can approach the 3 following types of finance companies in Kolkata and apply for loans for a small business you want to set up.

Mutual savings banks

Such types of companies are considered to be depository institutions that pool funds from a number of depositors and grant them to borrowers. There can be numerous risks associated with lending, due to mismatch of information between lenders and applicants or borrowers. But the majority of mutual savings banks offer a convenient system of payment to loan takers. These companies, apart from lending, also offer various other services such as helping trade finance with the aid of letters of credit.

Credit unions

These happen to resemble banks in different ways. These are owned as well as supervised by the workers of the company. A one-member one-vote system is used for the management process. Like Mutual Savings Banks, these are also referred to as depository institutions. These institutions determine the credit-worthiness of borrowers before they are granted loans. The credit score of borrowers is of great importance when it comes to obtaining loans, whether they are into internet trading, manufacturing or any other type of activity. A higher credit score inspires confidence in financial institutions about the repayment ability of borrowers.

Credit unions are also known as Thrift institutions, and the organizations also offer foreign exchange services to borrowers from a number of other countries.

Mutual funds

These are regarded as non-depository organizations. Such companies use the profits for the purchase of bonds and stocks, and also sell shares to individuals. Such kinds of institutions fall under the category of investment companies — that are regarded as a major kind of Securities Company. When compared to a number of other trade finance companies, mutual funds provide clients with big scale funds which are otherwise unaffordable for smaller investors. With the help of such large scale funds, small investors can build portfolios consisting of assets of higher number and more diverse in nature.


Originally published at www.ashikagroup.com.