Loans For Small Business (Which Guarantors Are Needed by Banks)

Due to the fact that many banks are currently trying to bring their own small business loans to the market, the question is especially acute, and what bankers really want from business is to give them a loan. The issue of assessing the risks of lending to small businesses is often not sufficiently developed, but this is not surprising. It is difficult to assess the company's finances if the overwhelming majority of start-ups reflect the minimum indicators in their reporting, or even give zero reporting.

In such a situation, the priority is to secure the loan for the business ie. Pledge and guarantee, but proceeding from the fact that only a very small number of new organizations and entrepreneurs have real estate or vehicles that can be used as collateral, the guarantors are the main guarantors of loan repayment.

Banks understand the aspirations of entrepreneurs and unsecured loans for small businesses have already begun to appear. True, the maximum loan size for such programs is not large and ranges from 1 to 3 million rubles.

The situation with the guarantors is somewhat different. It is enough for some banks to indicate one of their close relatives as a guarantor, while on the other hand the conditions are such that the relative can not be a guarantor. Still others do not take employees of the owner of business as guarantors.

As for the relatives and employees of the owner, the fears of the banks are understandable, because both can be made to act as guarantors, however, there are no universal requirements for guarantors that all banks would use.

However, this is the position of banks, but I would like to know who the small business representatives themselves can provide as a guarantor for their loans? If a relative acts as a guarantor, this simplifies the matter, but if the requirements are such that the relative can not be a surety. There are friends and acquaintances, but they are very difficult to persuade to take responsibility for the loan of even a familiar person.

Perhaps the requirements of banks to the guarantors are too high, and entrepreneurs can not provide suitable guarantors.

I suggest you take part in a short survey, which will only take a few seconds of your time, but it will help to identify what kind of guarantor is able to provide a small business for a loan.

Go to the survey can be at this link. Waiting for you.