To make money, we need money. In today’s time, we all suffer from scarcity of money as we have to take care of other financial responsibilities and end up with almost nothing at the end of the week or month. Savings becomes a huge task in such kind of a situation. We have often seen families struggling to meet their ends meet, paying their credit card bills and all other bills that one can think of. Now in mid of all these, if you aspire to set up a business, you may find it to be an impossible dream. Undoubtedly, setting up a new business requires good chunk of money and especially where people are suffering from scarcity of funds, it is futile to think of any influx of funds for your business. You can reach out to your friends or relatives to lend you some money but that really won’t be sufficient to give you a start. Alternatively, they have their own problems to sort. So, it becomes hard for them to lend you a helping hand. In this situation, you are left with one good option. Borrow money from a financial institution at a lower rate of interest and give a start to your business aspirations.
Few things that you need to be aware of before you approach a bank or any financial institution for money.
Your business plan should be concrete:- The day you aspire to set up a business of your own, you start working to chalk out a plan. Include all the ups and downs, ifs and buts in your plan and see where it lands you. You can make amendments to your plan and if necessary re-start your plan from the scratch. Just make sure that once you are done with it, you have a sound plan with you. The relevance of a sound plan will help you fetch a loan from a bank. A bank will not take interest in what you say as long as you don’t have any concrete plan to show to them. Only when you come up with something which sounds good to the bank and they can put their faith on your plan, they will help you sanctioning the loan.
Get government sanctions:- There are some businesses which require government sanctions. So by the time, you are in discussion with the bank for the loan, also intimate them that you are also talking with the government authorities to give you the authority to conduct your business in the desired location. That will give confidence to the bank that you are seriously into it and lending money to you will cause no harm to them.
Be ready to give collateral:- If you intend to borrow a huge sum from the bank, you should be ready to keep something as mortgage with the bank. The bank shall not sanction the loan if they do not have the collateral with them. You may keep your house as a mortgage or some other investments. You should therefore be very sure that you have set everything the right way before you take the final leap.