As a business owner, when applying for unsecured business loans, you need to be ready to highlight your business’s financial performance. You also need to have a clear repayment plan, detailing how and when you’ll repay the loan. You need to keep lenders informed about the ups and downs of your business.
You should expect delays. The process could take up to 3 months, so be willing to wait a while. Whether you apply for a loan from a bank or from a micro lending institution, doing the necessary checks on the business and deciding on the viability of the business plan will take time.
When applying for unsecured business loans, you need to know exactly how much money you need. You also need to be specific about what you’ll be using the money for.
In South Africa, government’s small business finance agency, Khula, offers small businesses a credit guarantee scheme.
Many small businesses don’t have assets to put up as collateral for a bank loan. Khula has recognised that this is a stumbling block for many business owners looking for funding.
To qualify for a Khula-supported loan you will need to contribute to your business and this may be as much as 10% of the amount you want to borrow (in the form of cash or equipment).
The minimum loan amount you can qualify for is R50 000, while the maximum amount that can be approved under the scheme is R3 million.
During the application process, you’ll need to provide your business plan as well as clear and thorough financial information.
The unsecured business loans offered by Khula can be used for:
- Purchase of fixed assets
- Refurbishments and alterations
- Acquiring a new business
To apply for these unsecured business loans, contact Khula by calling 0860 123 000 or 011 299 4701.