At the end of 2017, over three million sole proprietorships were registered in the country. This is an absolute record in the history of the country. In addition, interest in running your own business is still huge – there are about 20,000 new companies on average every month! People are becoming more enterprising and more boldly quit their full-time job. Some professional careers start immediately from starting their own business.
However, it cannot be denied that running a business is a big challenge. We cannot expect regular payments here every month, but we have to rely on the solvency and timeliness of our contractors, with whom it is known that it is very different. However, we know that a company should not stand still, but constantly develop. We may have a head full of ideas, plans for great and reliable investments, but we will not be able to do anything without them.
Company development is usually expensive because it involves the purchase of new equipment or technologies, expanding the company space, implementing new activities, or even employing more employees. Fortunately, there are solutions that make investing in the business possible, even if it is small and exists on the market for a short time. An investment loan for small and new businesses should help.
Investment loan for new companies
Obtaining financing for companies operating on the market for a short time is difficult but possible. Unfortunately, banks are wary of less experienced entrepreneurs, which is also caused by the fact that the amount of outstanding bank loans is still growing. Therefore, before granting a positive decision, analysts will ask for a number of documents that will prove our credibility and ability to repay the commitment. We must remember first of all that each bank has its own procedures for analyzing loan applications and the type of documents required may be different.
Certainly, we must present those that confirm the existence of our company for a certain time, e.g. an entry in the business register. It may be necessary to confirm the income tax transfer for the months in which the company operates or the entrepreneur’s declaration that he did not have to transfer such tax due to too low income. Here we come to a very important moment of applying for an investment loan for small and new companies , i.e. the amount of income. Some entrepreneurs intentionally overstate the costs of doing business to avoid paying income tax. Remember, however, that it can take revenge quickly when applying for a loan. The bank will refuse to grant it if it finds that a company that has been showing only a loss for months does not deserve to be credible.
These documents, which may be useful to us, will also include certificates from the Social Insurance Institution and the Tax Office regarding non-arrears with contributions and taxes. The bank may also request a statement from the company account and a summary of the revenue and expense ledger and, optionally and depending on the industry in which we operate or the legal personality of our business, other documents.
Investment loan for small businesses
There is no doubt that sole proprietorships constitute the largest percentage among all companies. Therefore, it would be unwise for banks to completely limit small entrepreneurs in obtaining credit products – they constitute a huge number of customers. Therefore, an investment loan for small businesses is also possible. In this case, we should start by preparing a good business plan. Our investment ideas should be attractive to the bank and prove that thanks to them the company will grow and be more solvent.
In addition to the business plan, you will need a complete set of financial documents for the company, bank statements and official certificates of timely payment of contributions . An investment loan for small companies will be difficult to obtain for those entities that delayed payment of installments of liabilities or failed to pay contributions and taxes. We will receive a detailed list of necessary documents in the bank before submitting the loan application. We usually have at least seven days to deliver them.