Working capital loans are short-term loans that are used to finance daily business operations. While these loans are not intended for acquisition of long-term assets or investments, they can ease the handling of day-to-day expenses. Routine operational costs of a business may vary across businesses but in general, they are categorized into fixed and variable costs.
Fixed costs include expenses such as rent or employee wages while utilities such as electricity, water, production costs etc. are covered under variable costs. As you increase awareness about your product or service, you also require working capital to finance advertising and marketing campaigns for your small business. You may also use them towards inventory purchase.
Why Working Capital Finance Matters?
With rising inflation rates and an unfriendly economy, many businesses are unable to generate the revenue required to fund their daily operations. As a result, business owners are often stressed out over stretching their funds to cover their business operations while funding other aspects of their business.
A working capital loan can help tide you over until your business gains a firm foothold and you are able to meet your day-to-day operational expenses. This can give you some much-needed breathing space during which you are able to continue business operations despite an inability to cover related operational expenses.
A significant cash infusion can make a huge difference to business performance. Gaining access to adequate capital can help you accept new orders that require increased production capacity or power up your marketing campaign to increase sales.
When Do You Need Working Capital Loan?
You could require a working capital loan under different circumstances. These include starting a new small business, during expansion or for restructuring your current business. Seasonal businesses also need funding to help them stay afloat during lean seasons.
For example, a ski equipment rental business may require external funding to keep them operational during the summer months.
Most lending institutions will require your company’s credit history, cash flow details and projected revenues to approve your loan application. Loan approvals can take as long as 2 to 3 months.
Best Working Capital Loans Available For Small Business
Merchant Cash Advance is the best, smartest and quickest option available out there. You get $10,000-$1million of unsecured funds, max 2X of your gross monthly revenue, within 3-7 days, This is a great way of gaining access to working capital loan for those businesses that have run into issues and require funds for daily operations.
Working capital loan can be typically repaid in one of two ways. One is by offering a small percentage of sales towards repayment. This percentage/amount is decided at the time of application between the lending institution and the applicant.
Another way of paying off the loan is to pay a small amount on a daily basis from Monday through to Friday. This method of repayment helps you build up a respectable credit history and reduces stress levels.
For more information regarding the working capital loans for small businesses, you can call us on 703-399-1685, or kindly write to us at email@example.com to get expert advice.
We are unable to work with the following restricted industries at this time.
Any Start Up Business (Less than 6 months in Business)
Non-US Companies we cannot fund under any circumstances.
Multi-Level Marketing Pyramid Schemes
Investment Firms, Financial Firms, Mortgage Companies or any Money Service Business (MSB)
Escort Services businesses
All Marijuana Businesses Illegal at the Federal Level
Government, Non-profits, Public Administration and Schools
Credit Repair Credit Counseling
Religious, Civic Organizations
Rooming and Boarding Houses like AirBnB-type rental businesses
Rideshare business like Uber/Lyft.
Debt Collection Agencies
Real Estate/Property Management companies
Cell Phone Stores
Night Clubs & Event Promotions
** Royale Funding reserves the right to change the list of industries at any time and all lending is subject to final underwriting approval regardless of the industry.