Touch Financial has added unsecured business loans to its acclaimed range of services. Here we’ll discuss the challenges which these loans can help your firm overcome, as well as the unique benefits it offers when contrasted with our other products. Read on for a range of scenarios involving companies of differing scopes, sectors and situations which could stand to gain from this invaluable source of funding.
Scenario 1: Your business owns little-to-no assets but needs working capital
Easily the clearest distinguishing factor between a secured and unsecured business loan comes in the form of ‘collateral’, often otherwise known as assets or security. As the latter of those synonyms would already suggest, secured loans involve individuals or businesses needing to offer collateral – such as vehicles, equipment or even commercial properties – in order to reach an agreement with their funder; unsecured loans, in contrast, carry no such stipulation.
The resultant freedom to trade assets without the risk of losing them at a later stage frequently proves invaluable to small- and medium-sized enterprises (SMEs) in particular. Many up-and-coming businesses will own next-to-nothing in the way of usable collateral during their formative years, or potentially operate in a digital industry which relies upon intangible assets, rendering the proposition of sacrificing assets daunting at best and impossible at worst. As such, unsecured business loans eliminate a common source of doubt for SMEs from the outset.
Scenario 2: Your business wants a cashflow solution which rewards their creditworthiness
In the absence of procuring tangible assets, firms operating within the banking or recruitment sector – to name but two of the countless industry examples – will sometimes focus on building their financial reputation, working to attain a high credit score by paying debts on time, minimising credit card balances and proving that they take a risk-averse approach to their operations. Doing so quickly offers these companies more in the way of funding opportunities, and certainly doesn’t harm their case for an unsecured business loan either.
Case in point: loan providers will analyse their clients’ business in detail once they receive a completed batch of paperwork on the subject, with a high credit score often proving particularly attractive in sealing the deal. Touch Financial’s expert consultants will strive to recommend the most appropriate providers for your business regardless of your creditworthiness, yet suffice to say that those looking for a funding solution where their credit score holds extra merit would do well to consider exploring the unsecured business loans available with our assistance.
Scenario 3: Your business struggles with late payments from customers
According to the Federation of Master Builders (FMB), belated payments from ‘cowboy clients’ – who withhold owed funds on vague grounds – presently affect almost 75% of UK construction firms, a figure which only serves to confirm our recently-discussed suspicions of a late payment crisis facing countless domestic businesses. Such delays clearly pose a substantial threat to construction SMEs, whose finances may initially rely on a select few projects and could therefore soon collapse if late payments pile up.
Touch Financial offer a range of services aimed at dealing with live payments, from invoice finance to industry-specific products such as wholesale finance, with unsecured business loans the latest among them. Those companies which need help with generating working capital or maintaining their ongoing operations while chasing late payments can benefit hugely from the advances this facility provides, even opting for a short loan term just until they have successfully recovered the overdue amount from their customer(s).
Scenario 4: Your business intends to launch a short- or long-term project
With a New Year comes renewed drive for UK firms, prompting most to consider how they can best utilise the next 12 months in order to yield the strongest bottom line come Q4. Some retail enterprises might consider launching a 1-2 month promotion on Spring Cleaning products, for example, while construction firms could take a more ambitious approach to expanding their ventures, instead bidding for large-scale projects sure to sustain them for the duration of 2018 and – in many cases – beyond.
No matter what your company’s chosen approach for the next fiscal year, unsecured business loans can prove invaluable in terms of allowing projects to go ahead without placing a firm’s finances at great risk. With various loan terms available, your business can be matched with the right deal to suit the scale of its ambitions for 2018, regardless of whether you want to launch a three-month or three-year initiative.
Find out more:
We hope that you’ve found this guide useful as an entryway into the numerous benefits an unsecured business loan can offer no matter what your size, sector or present financial situation. If you still have further questions, though, then be sure to visit our dedicated product page and our guide comparing these loans to our invoice finance services, both of which provide extra details on the strengths and considerations involved with unsecured business loans.
Above all, get in touch with our consultant team today and find out how we can help you locate the right funding solution for your business with the minimum possible hassle.