Almost every company is in a situation where external financing is necessary at some point in its business development. When you need financing depends on many things: digital marketing in particular is a fairly new area of marketing, in which case a company may need a loan, especially in its initial stages, for example for investing in equipment or facilities needed in business operations. Sometimes the loan becomes relevant when the company expands its operations and, with that, new types of acquisitions are needed, for example. A variety of surprising situations can also arise, when a loan can be used to secure the continuity of the company.
Committing to a business loan is always a big decision that should not be taken lightly. Loans should be tendered and compared in order to be able to choose the most suitable option for your needs and your company.
Since the comparison is often tedious and the information difficult to access, it is worth using a loan comparison service when comparing business loans: it will save you a lot of time and effort. All information is in one place, and you can see clearly business loan actual costs.
What is a business loan for?
It is possible to take out a business loan for a wide variety of costs and expenses related to the company's operations. Loan amounts and loan periods vary according to situations and financing needs.
There are several reasons for taking out a business loan:
- various acquisitions and stock replenishment
- when the operation expands, the salary of new employees often rises to the list of needs, for example,
- expansion or renewal of premises
- acquisitions of equipment and materials related to expansion.
Whether the company is in the initial stages or is already longer in operation, marketing is always needed. Even the best service doesn't produce results if customers can't find it and consume the service. As every digital marketing company knows, marketing is an investment that pays off, and it's also a common business loan target. There may also be situations where a business loan is needed to refinance a previous debt or, for example, as working capital.
Unsecured or secured business loan?
Both unsecured and secured loans are possible when considering the best loan option for the company. Secured loans are especially preferred by banks, but there are also plenty of unsecured loan options from other financial institutions. Today, the applicant for a business loan is in the fortunate situation that he has a genuine opportunity to choose the most favorable for himself and his company from numerous different types of loans.
A secured loan means that the loan has collateral, which can be realized as money, if challenges arise with the repayment of the loan. Collateral can be, for example, real estate, land, securities or, for example, large machinery related to the company's operations. If necessary, an unsecured loan is a particularly good option if the loan amount is relatively small, a maximum of around 250,000 euros, although this is also of course situation-specific. Such a loan also requires a clear and, above all, realistic payment plan, just like all other loans.
Can a digital marketing company apply for a business loan?
Any company registered in Finland is entitled to apply for a business loan for its operations. The loan is not limited by, for example, the size or age of the company. The most typical applicants for business loans are SMEs, which may be at very different points in the company's life cycle.
The only condition for applying for a business loan is that the credit information is in order and there are no records of payment defaults. It is important that the company's finances are in such a position that repayment of the loan is possible and feasible.
Loan period according to the company's needs
It is possible to take out a loan for a short or longer period, depending on the company's financial needs. The loan calculator makes it easy to find out the real costs of the loan at different time intervals. At the same time, it is important to think about the company's current situation, cash flow and future forecast. The loan period should be agreed in such a way that paying the loan does not put an unreasonable burden on the company's finances at any point.
If the monthly installments of loan repayment and interest are too large compared to the company's income, loan repayment can become too much of a burden for the company's operations. This is not desirable, sensible or economical for anyone. A suitable loan installment is one that, after payment, will also have enough funds to maintain and develop the company's operations. Today, it is possible to negotiate sufficiently long payment periods for business loans, so that the payment installments are suitable for the company's financial situation.
Take into account the interest rates and actual costs of the business loan
One important step to suit your needs business loan the choice is to familiarize yourself with its interest rate. It is possible to grant a lower interest if the company's financial situation is stable and the future appears to be risk-free. The interest rate is also affected by whether previous loans have been handled flawlessly: if, for example, there are a lot of defaults, this is considered to predict problems related to loan repayment in the future, when the interest rate will also be higher.
It is also common that the interest rate of the loan is affected by the amount of the loan. A smaller loan usually has a higher interest rate than a larger amount. In addition to this, the interest rate is affected by the repayment period of the loan. When comparing loans, it is good to make it clear to yourself whether you are talking about the loan's annual interest rate or monthly interest rate, which can differ from each other.
The interest rate is not the only thing to consider when considering a business loan. It is also essential what the actual loan servicing costs are like. These may include, for example, the account opening fee and account management fees. Small hidden costs can add up to a surprisingly large amount, especially if they are regular.
Digital marketer: consider a business loan too
A business loan is a viable option when a company needs external financing. Taking a loan is a part of almost every company's operations at some point. It is often a factor that allows the company's operations to grow and meet new challenges. Business loan should always be applied only after thorough consideration and comparison. This is where our loan calculator helps, with which you can also get an idea of the real hidden costs of the loan.
When choosing a loan, determine the amount to be applied for by relating it to the company's cash flow. In this case, the loan works as it is supposed to: as an enabler of the company's success, and not as a big mental and financial burden for the company. If at the end of the free comparison, for one reason or another, you don't end up applying for a loan right now, you've still got a comprehensive picture of what kinds of financing methods are available to entrepreneurs in the current market.