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Where To Get Money For A Business Start Up

Small-scale business crediting

Today many banks assert that small-scale business crediting and it is one of their priority tasks. But in practice this statement is not implemented, after all to take the credit for a small firm is a very difficult task.

In a similar situation each party has arguments and explanations. Banks are confused with small scale business that makes difficult a real estimation of its fortune, besides; frequently there is no mortgage provision. Owners of small-scale business very often have no possibility to use credit programs of banks because of the overestimated interest rates at incommensurably short terms of repayment of a loan, and procedure of reception of the credit is difficult and long.

In addition, they don’t have start up capital or representatives of small-scale business don’t reflect a real financial situation in the reporting that considerably reduces probability of reception of money for replenishment of circulating assets or production modernization.

Unconditionally, present conditions of bank crediting of small-scale business are far from perfect. The authorities, understanding complexity of a situation, try to meet half-way business. In many regions government programs of crediting of small-scale business are already implemented. How much such support is effective the time can show. From the city budget the part of the expenses connected with reception of the credit in bank – in particular is compensated to businessmen, also is practiced partial subsidizing of the interest rate. Thus, small-scale business has possibility to receive means with smaller costs.

That fact isn’t called in question that first of all at registration of the credit the borrower pays attention to price parameters – the interest rate, term of repayment and the greatest possible credit amount, and also consideration term of application. The average rate in sphere of crediting of small-scale business constitutes 12-15 % in dollars.

Unconditionally, the rate size has regional features – percent on the country can differ on 1-3 points. However specialists notice that the tendency to equalization of credit rates in the market recently was planned. By the way, experts predict also general decrease in rates. So, according to Association of the banks, with 2002 for 2006 the mid-annual credit rate has decreased from 26,6 % to 16,2 %. The sum of crediting of small-scale business varies from 5 thousand to 1,5 million euro for the term from 6 months till 7 years.

Besides, it is necessary to consider about accompanying payments – the commissions which can increase monthly payment. Banks which specialize on crediting of small and average business can grant a delay of principal payment for the term from a month and about to one year, but don’t release from repayment of current percent. Before to take the credit, it is necessary to estimate the possibilities and problems with money return.

The times when governments have been showering people with all sorts of grants have passed. At least for a while. But that does not imply that you must forget the idea of getting small business grants.

Everything is doable with smart attitude; small business grants including.

Visit this blog for more helpful tips about grants, how to apply for grants, grant samples, ups and downs of the grants. This information will help you to get small business grants or any other grants in a more convenient way.

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