How to get financing without endorsement? This may be the question that many entrepreneurs, companies and institutions ask themselves when there is a need for liquidity to start a business, develop it or consolidate it.
It is well known by all that traditional financial institutions usually require quite rigid conditions when granting a credit operation, among which is the existence of guarantors that guarantee compliance with the obligation acquired.
For this reason, many operations are not authorized, leaving the projects in no man’s land.
However, the economic crisis has also facilitated the emergence of new financing alternatives other than banking, with much less requirements and greater flexibility.
Financing without guarantee: Where to start?
Unless you are a large company with years of proven track record and high repayment capacity, it is virtually impossible to obtain a financial operation without collateral from the classic banking entities.
However, there is no reason to give up the initiative to make your project a reality. What you need to know is where you can go in search of liquidity.
For this, there are several alternatives:
Microcredits are a good alternative offered by some financial institutions with special conditions, such as absence of commissions, flexibility in terms, reduced interest rates … etc. While it is true that in recent years, and due to the increase in delinquency, these types of operations have been considerably reduced, the key is to offer a good business plan that demonstrates the viability and potential of the project.
Crowdfunding Platforms have experienced a great revolution in these years of crisis, as they have become the main source of information for entrepreneurs and startups. Collective financing is managing to finance projects of great relevance at national and international level that otherwise would not have been possible. It is about attracting patrons, who finance the project through their monetary contributions, in exchange for a reward.
Kickstarter and Indiegogo, are two of the main ones that have achieved more success.
Crowdlending or loans without collateral
It is a modality within collective financing known as P2P (pair to pair) loans. These are credit operations financed by more than one person (lenders) in exchange for a more competitive interest rate than banks. On the other hand the borrowers (those who receive the money), also benefit from the absence of commissions and the speed in the management of the operation. It is an ideal way to avoid bank bureaucracy. Within crowdlending, loans without collateral are the most traditional form of financing without collateral.
These are professional investors whose main objective is to invest in projects with great potential and high chances of success. They tend to be involved in all the initiatives they are committed to, that is, their contribution is not only monetary but also provides their personal experience, knowledge and training. The best way to attract your attention is to attend the different entrepreneurial events, incubators and accelerators, where you can have the opportunity to present your own projects in your presence.
Venture Capital Companies, or Venture Capital, are those made up of investment professionals who act as third-party fund managers and their mission to diversify their investment portfolio through different projects that involves high risk, but also high expectations of success.
The requirement is to transfer a minimum part of the share capital, which will later be returned in the divestment process.
Getting financing without collateral is possible regardless of traditional sources of credit..