Out of all the things that a small business does, acquiring capital is one of the most important. Through financing, companies are able to remain financially stable and maintain operations --and therefore continue to contribute to the economy. Access to financing is therefore not only crucial for businesses but for the country’s economy as a whole.
Small businesses need capital for several reasons. Sometimes it is for the day-to-day expenses, which is what we call “working capital”. This is what business use to pay for necessities like utilities, supplies, rent or salaries. Other times they need to invest in larger purchases like asset acquisitions, purchases of a piece of land or equipment, or maybe buying a bigger warehouse for their inventory.
In a collateral loan, the company that is looking to borrow money must guarantee some form of collateral. Collateral can be anything of value that will become the property of the lender in the case of a default. This may include inventory, account receivables, equipment or real estate.
A collateral loan is also known as a secured loan because the borrowers debt is secured with the collateral. Since the loan is secured, lower interest rates can be offered. In the case of a default, the lender can then sell off the involved collateral to recoup losses.
We at The Credit Junction have established an online marketplace lending platform that makes access to working capital more efficient for borrowers. Our business was established to address a gap in the sources of capital available for small and mid-size enterprises created by lack of opportunities for credit from traditional sources, and lack of interest in the manufacturing and industrial sectors from venture capital firms and other non-traditional venues.
Our goal is to improve your cash flow by providing flexible asset-based lending at competitive rates to allow you to focus on your business. If it's working capital you need, The Credit Junction is the solution!