What Types of Business Finance Can I Access?

In these difficult times, many businesses are looking carefully at their financing options. Whether that’s to stay afloat, or to reposition, relaunch and to grow, finance is essential for success. But what types of funding are there? Here are some of the main types to understand:

Equity finance

This can be offered by large companies on a stock exchange or by seed companies via a crowdsourcing initiative. The company essentially sells shares in itself, receiving investment in return for ongoing dividends. The benefit of this type of finance is that it allows the company to maintain a healthy credit record – and the potential to attract significant funding. However, it also means that the original owners dilute – or even lose – their ownership.

Debt finance

This occurs where the company sells bonds or other products to lenders in return for finance. This type of finance also includes traditional loans and lines of credit with a bank or business lender. Other more complex types of debt finance can be exchanged on financial markets. Sometimes debt finance is used for mechanisms such as hedging. It’s important for the business to know exactly what type of finance it is accessing, at what risk and upon what terms.

Grants

Sometimes businesses can access a grant, especially if they work in a strategic growth sector such as green energy. There are also some grants available to businesses looking to get through the Covid pandemic and the current lockdown restrictions. A good starting point to find these is via the gov.uk website and also local authority websites which detail sources of grant funding and other finance for businesses.

Which type of funding is best for me?

There is no ‘right or wrong’ answer to this as every business will have its own circumstances and needs. For example, debt finance will need to be repaid on a certain date if you have taken out a loan – or the debt replaced with a new type of debt. Equity finance doesn’t mature in this way, but shareholders can usually sell their equity at any time and businesses will need to pay a dividend in order to keep their investors.

Quick and easy business lending

At Century Business Finance we pride ourselves on offering ready finance to all established businesses – and for all business purposes. What’s more we are an extremely flexible, nimble lender which has created its successful operation around a digital model.

We offer business loans of £10,000 to £150,000 for any kind of business purpose – whether you’re looking to secure your business, grow it or take it in a new direction. The loan is flexible too, and you can choose whether you borrow for 6 months to 2 years. There are no upfront fees or early repayment charges and no meetings either. In fact, we manage the entire process online using the slickest, fastest systems.

Simply complete a short online form and our team will quickly review your application. Your loan funds could then be in your business bank account within just 24 hours. Apply today for a rapid decision and quick access to the funds that you need to thrive in 2020 and beyond. For any queries, our helpful team is here to help!

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