Short-term loans are very useful products. In most cases, they must meet business needs related to increasing liquidity. Suppose an SME has unexpected demand or wants to take advantage of a new business opportunity that temporarily doesn’t give them any chance. In that case, a short-term loan could provide fast and flexible financing. These loans are generally offered by alternative financing bank, which requires less restrictive requirements than traditional banks.
Loans for companies: which banks grant them?
Which banks provide short-term loans to businesses? By now, the credit institutions have understood the needs of the entrepreneurial realities, which, given the delicate economic moment, often have difficulty moving forward between late payments and taxes.
Here comes the short-term loan, among which it is possible to include Unicredit products. This credit institution allows companies to choose between different solutions, among which there is the Loan for Cash.
In this case, you are faced with a loan that allows you to meet any liquidity need without considering the maximum amount to be financed. The Unicredit business loan package includes the credit line for advances subject to collection and the credit line for advance invoices.
Loans for businesses: this is what a Short loan offers
As specified above, numerous credit institutions provide short-term loans. This credit institution offers several alternatives. Businesses can choose from commodity and document grants, sales contract grants, and temporary expense grants. Let’s go into the details of the various products by seeing, for example, how the subsidy on goods and documents works.
Funding on goods and documents: Short loan financing guide
The subsidy on goods and documents is one of the solutions that a Short loan makes available to those looking for short-term financing. In this case, the bank makes a sum of money available to the customer against the presentation of a guarantee on the goods in storage or on the documents representing those that have yet to be sold.
This product has the specific objective of helping companies to face moments of economic need while waiting to complete the production cycle of the goods.
A useful example to better understand everything is the realities that operate in the food sector, which, for example, have to wait for some products intended for distribution and sale to be affected by specific maturing and maturation times. The loan can last up to 12 months.
Funding on sales contracts: this is how it works
You can take this guide dedicated to short-term loans by talking about another Short loan product, namely the subsidy on sales contracts. Also, in this case, you are talking about a loan that can last a maximum of 12 months.
In this case, the credit institution makes a sum of money available to the customer, corresponding to a percentage of the contracts stipulated by the company with its customers. Hence the need for companies to prepare and plan with the help of short-cycle budget exercises, hopefully bimonthly, that lead them to review the spectrum of a year. Administrations, before starting a year, should have their working capital funding sources ready,
Identify at what time and under what circumstances the company may need additional resources to help it leverage itself, to finance working capital, and when this happens, they have certainty about where these resources will come from because normally, short-term resources do not are financed with the resources of the shareholders, it is not correct to call the shareholders to buy merchandise or to buy inventories or to lower quotas with suppliers.
Shareholders are asked to make long-term investments, make adaptations, and purchase machinery, not necessarily to meet day-to-day needs that should be almost entirely met by internal cash generation. Have very advanced financing alternatives (commercial loans, commercial strategy loans that range between 2 and 24 months and can be paid at any time, when the Company deems it necessary).