What is Alternative Lending?
Alternative lending or alternative non-bank lending solutions describes a broad range of loan options that fall outside traditional bank loans. These loans are often an attractive alternative to consumers and business owners who prefer not to adhere to the rigid structures and processes attached to traditional loans.
Consumers and business owners choose alternative loans for a number of reasons – perhaps they don’t have the most stellar credit history – especially for small business owners – they may not have a credit history at all if they have just started their business. Further complications may arise when there’s some documentation that’s particularly hard to pin down, or simply the borrower doesn’t have, or doesn’t want to, use their existing assets to secure a traditional bank loan.
Alternative bank loans are also particularly attractive because they are far more flexible, offering many more finance options than traditional banks. Alternative options such as unsecured business loans offer competitive interest rates and boast a high turn-around time because of the lack of bureaucratic red tape. Such loans are great for small businesses because they don’t require owners to put up their own assets to secure a loan. The credit requirements aren’t as stringent as traditional bank loans, and loan terms can often be negotiated to suit a certain business and its schedule.
The greatest advantage of alternative lending solutions is being able to tailor the loan to your business. It offers great flexibility and provides far more options to suit personal or specific business needs than traditional bank loans. Unsecured business loans take away the need for collateral, and forces you to bank on the health and performance of your business instead – pushing you to do better as a business. If traditional bank loans don’t work for you, shop around for something that’s more flexible and that can be tailored to suit your needs.
To find out how SmartAdvance has helped other small businesses, watch the video below.