How to get a business loan from scratch? Which banks and under what conditions give loans for business from scratch

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

The axiom of commerce is that any business needs financial investments. This is especially true at the initial stage of activity. In order to earn money on the implementation of a business project, you must first invest in it. Large projects require a lot of money, small ones a little less. But getting rid of expenses in principle is impossible under normal conditions.

It's good if a novice businessman has at least some money. And if not, there are several options where you can legally get finance. One of them is to get a business loan from a bank. Its conditions should be relaxed compared to the usual. Otherwise, a successful start of the project will not be seen. But even here certain subtleties and roughness arise.

Risks for the parties

Commercial banks give loans only at interest. On general terms or preferential, but in addition to the loan itself, you will also have to return the accruedinterest. If the business is successful, then such a financial loan, no matter how heavy, will pay for itself. And if not? An unsuccessful businessman will lose not only his business, but also his property. Otherwise, it will remain a debtor with all the ensuing legal consequences.

It should be noted that for a bank, issuing a loan for the development of a commercial business is considered a risky deal. There is no unconditional guarantee that the loan of a newly-minted merchant, received for the creation of a small business from scratch, will be returned. In the worst case, when the option of ruin appears on the horizon, an unsuccessful entrepreneur may, after a certain period (mostly a month), declare himself bankrupt and refuse to return the money received to the bank.

And yet, how to get a business loan from scratch? It is no more difficult than getting a regular loan for education, home improvement, car purchase and so on.

Required conditions

Despite such risks, credit on favorable terms for small businesses is slowly but still being restored. Including taking a loan for a business from scratch, it is possible, subject to certain strict conditions. However, there are no super-heavy impossible clauses in the contract:

1. Good credit history of the borrower. Difficulties with paying past loans, outstanding loans or late payments can be the reason for a loan refusal.
2. Professional business plan. The self-evident possibility of quick earnings, albeit small but stable, will force financial experts to agree with the borrower and issue the necessarysolution.
3. Employment providing additional income. A solid income makes it possible to successfully repay a loan received to develop a small business from scratch.
4. The presence of personal property that can be mortgaged under a loan. This is a serious pledge of a mandatory refund.
5. Having a reliable guarantor.
6. The existence of start-up financial capital, which is approximately 25% of the required amount.

There are other circumstances in the question of how to get a loan for a business from scratch. It is worth considering at least some of them.

Banks

Where can I get a small business loan from scratch, which bank should I contact? It must be understood that, firstly, not all financial institutions provide such loans, and secondly, the requirements and offers of the bank differ, and a businessman, of course, wants to choose the most profitable option.

Russians who want to organize their own business can accept the help of a number of financial institutions. Which banks give loans for business from scratch? A small business loan from scratch is available in several banks of the Russian Federation - more on them below.

VTB24

VTB24 offers the most favorable rates for legal entities registered in Russia, quite diverse conditions, including business loans for individual entrepreneurs. The approaches to LLC and sole proprietorship differ significantly. Often, property is required as collateral for a loan. Specific examples:

1. Express micro. The loan is given in the amount of 30,000 to 600,000rubles for a period of 3 months to 3 years. Collateral personal property is not required.
2. Small loan. Financial resources are released on the security of personal movable or immovable property for a period of 3 months to 7 years. The amount of the loan is in the range from 600,000 to 30,000,000 rubles.
3. Under contract. By issuing such a loan, the bank subsequently has a legal right to claims for amounts passing under the agreement. The loan is issued for a period of 3 to 12 months. The amount of the loan varies from 150,000 to 6,000,000 rubles.

Sberbank

Sberbank issues a loan for a new business from scratch as part of the Business Start project. Financing is given for an existing business project. It is also possible to operate a franchise entrepreneur.

In addition, for the registration and development of your own business, you can join the credit program "Business Trust" of Sberbank. It does not require strict reporting on the purposes and directions of lending. "Business Trust" is:

• loan without collateral;
• amount of funds in the amount of 80,000–3,000,000 rubles;
• no commission;
• need a guarantor - the owner of the company;
• interest rate of 13.94% or more;
• repayment period is between 3 months and 3 years.

Rosselkhozbank

"Rosselkhozbank" presents individual loan products to strengthen small firms. There are no funding restrictions. The main focus is agriculturalsector, but there are other areas of loans for starting a business from scratch:

1. Investment standard. The amount of the loan is 60 million rubles, the repayment period is up to 8 years. Postponement of payments - up to 1.5 years. A personal loan repayment schedule is possible.
2. For the purchase of machinery and / or equipment, a loan is issued only against the security of the purchased machinery and / or equipment. Postponement of payments - up to one year. The loan period is up to 7 years.
3. For the purchase of land. It is issued only on the security of the purchased land. Postponement of payments - up to 2 years. Loan period - up to 8 years.
4. For the purchase of young animals, a loan is issued only against the security of purchased agricultural animals. Postponement of payments - 1 year.

Alfa Bank

There are only two types of business loans in Alfa-Bank. But at the same time, managers report activities with small and medium-sized firms as the most important priority.

Funding methods

Modern banking methods of financing loans to start a business from scratch have a number of subtleties. And the main one is to minimize risks, both discussed above and others (there are enough of them to consider a complete list).

First of all, financial institutions are faced with the task of determining the degree of financial risk when lending to applied small businesses. Banks use two methods, quite different in terms of objectivity and depth of analysis:

1. Workexperts on the application. In this case, the final decision on the allocation of a loan depends to a large extent on a very subjective verification of the businessman's arguments by bank employees.
2. Another massive way to determine the amount of risk is the use of an automated financial "scoring" system that appeared half a century ago. Not burdened by any emotions, the program calculates the points received, takes into account the overall results on the basis of the data indicated in the questionnaire of this client. Scoring is subdivided by type: by points received (it is necessary to reach the assigned level, many applicants do not reach it); against obvious fraudsters (through consideration of behavior reveals factors confirming data on a non-purpose loan, a possible threat to bank assets); against irresponsible and frivolous borrower clients (the possibility of delay is being considered).

Receive process

Getting a profitable business loan for an individual entrepreneur involves a certain strict procedure. Logistics for obtaining a loan to start a small business:

1. First you need to send a reasoned application to the selected bank. It notes the form of activity, a specific lending program.
2. Then you need to provide information about the financial situation of your small business. It will require a loan for a business from scratch and documents: you need to provide an identity card, TIN, a copy of the work book of a potential borrower, a certificate of income, documents confirming other income (bank deposit, shares of any companies,investments), papers establishing the right to real estate or other property that will act as collateral, and so on. The emphasis should be on the amount of profit received, a positive credit history, the presence of additional income or other sources of finance that will help return the money if things do not go well.
3. If the application is accepted (and this, as a rule, happens in most cases) and considered, specific work begins - the loan conditions are approved: the amount of funds, the chronological framework, the form of the loan.

Increase opportunities

How to get a business loan from scratch? When looking for a loan to develop their business, a novice entrepreneur needs to choose a bank as scrupulously as possible, in which he will then be serviced. Nuances:

1. When analyzing the situation of financial institutions, it is necessary to ask if there are special proposals (and what they are) for the development of small enterprises.
2. The advice and recommendations of commercial partners, acquaintances and friends in contact with a particular bank are important.
3. Loans are distributed more freely to existing businesses. An application with an attached project of a case not yet started has few opportunities to receive financial support.
4. It's not bad for your company to be solvent, to develop successfully for at least six months.
5. In favor of the bank's positive decision to issue a loan, there will be a certain collateral. Usually as collateralobjects of real estate, cars, technical equipment are considered.

Subjective factors

Moving forward on how to get a business loan from scratch, the bank is considering other factors that seem to be completely subjective regarding the borrower:

1. Current age. World practice suggests that the age at which a potential client is the strongest and most able-bodied and can most likely vouch for the process of issuing a loan is between 30 and 40 years old.
2. Formalized marriage. If the lender is legally married, his possible chances of obtaining the requested loan for an existing business increase significantly, because if there is a problem with the return of borrowed funds, the borrower's husband (wife) will be able to join the closing of the loan.
3. Monthly recurring expenses. A financial institution that lends to small business development may also consider the amount of the amount of the monthly cost in the process of developing the borrower's business.
4. Interior office space. The premises, which the credited businessman has allocated as an office, will be inspected by the bank for the presence of communications equipment, business office equipment, several computers and good furniture.

More options

When asking how to get a loan for a business from scratch, you need to understand that there is an alternative possibility of obtaining potential financial assistance - the usual consumerlending. A loan can be issued to an individual working in the company. A personal car or real estate can be used as collateral. The institute of guarantors is also used.

Getting such a loan is not very difficult, but loans are not entirely beneficial for a businessman due to high interest rates. Therefore, it is better to think again, look for options for obtaining start-up capital. Most regions of our country now have funds that provide financial support to small businesses. These institutions work on behalf of the state as guarantors for the issued loan, or they themselves can offer small concessional loans to businessmen.