What is a Small Business Loan, and How Do They Work?

Last Updated on May 14, 2018
what is a small business loan and how does it work?

What is a Small Business Loan?

The phrase “small business loan” is an umbrella term for any funding option designed specifically for small business use. What makes them so great for small businesses? They’re fast, they’re efficient, and they’re easy to get!
Flexible terms, minimal requirements, and loose qualifications make small business loans the tools of choice for business owners determined to conquer any business challenge, and seize all opportunities for growth and success.

How Do Small Business Loans Work?

Every business is unique, and so each small business loan offered by National Business Capital is designed to accomplish the goals of their clients on an individual basis.
This means that depending on what borrowers plan to use their extra capital for, and their repayment preferences, small business loans contain terms and conditions that are extremely flexible, and easily accommodate to the needs of virtually any client.
Here are just two examples of small business loans, and how they work in different ways to accomplish specific business goals:

  • Accounts Receivable Loans
    How it Works: Secure capital by using your receivables as collateral, instead of personal or business assets. AR financing from NBC can cover up to 95% of your accounts receivable. Clients typically receive funding for accounts receivable loans in as little as 2-5 days. AR financing from NBC has a flexible and ongoing term length for added convenience.
    Use: This type of small business loan is especially useful to suppliers who receive large invoices, but lack the capital to fulfill it. With AR financing, clients can turn their IOUs into the cash they need to acquire any extra materials and labor necessary to complete an order, and manage gaps in cash flow – without having to notify their customers.
  • Equipment Loans
    How it Works: The equipment loan options at NBC offer amounts anywhere from $5k to $3mill. Receive the funding you need for a new piece of equipment, and leverage equipment itself as collateral, instead of your own money and property. 1-5 year loan terms are available for equipment financing, to accommodate for both big and small purchases.
    Use: Upgrade or lease equipment for virtually any industry in as little as 24 hours or less.
  • Hybridge SBA Loan How it Works: This unique loan structure provides the benefits of an SBA loan without making you wait months for funding. You get access to between $50,000 and $5 million to fund common business expenses with 10 to 25 years to pay it back. And, the whole process takes between 45 and 60 days from application to funding. In the meantime, National secures bridge capital for your business in as little as 24 hours, allowing you to move forward much sooner than with a traditional SBA loan. Use: Boost working capital, purchase equipment, invest in a new location or cover just about any other business expense related to operations and growth.

Whether you prefer a fixed or flexible repayment schedule, short or long-term lengths, or a funding option with no collateral requirements, NBC has the right small business loan for you.

What You Need to Get a Small Business Loan

Qualifying for a business loan is easier when you choose an alternative lender like National Business Capital and Services instead of a bank. There’s less paperwork involved, and you usually don’t have to worry if your credit score or financial history is less than perfect. When you work with National, loan requirements are simple:

  • 6+ Months in Business
  • $100k in Annual Revenue
  • Less-than-perfect credit scores accepted
  • No Collateral Necessary

Consider These Reasons to Get a Business Loan

Needing funding for your business doesn’t mean you failed somehow or are lacking as an entrepreneur. In fact, sometimes it’s not possible to grow without a little financial help! Think about how much it costs to expand or open a second location. Could you use the cash you have on hand to invest in commercial real estate, purchase equipment, hire a new team and get enough inventory in stock to serve a whole separate set of customers? Probably not, which is why you’d use a loan to help you realize your business growth plan.
Loans can also keep your business from going under in the event of an emergency. What happens if a critical piece of equipment fails, and you can’t afford to replace it? A loan or lease can over the cost so that you don’t have to close your doors. The same is true for any unexpected expense; financing is available to provide the support you need to continue operating.  

How to Get a Small Business Loan

For most small business owners, asking a bank for funding approval can feel like asking the grass to grow. No matter how promising your pitch may be, and how clearly you explain the urgency of your plans, in the end, your words are falling on deaf ears. In the unlikely event that grass does listen, it could be anywhere from weeks to months before you see any patchy, uneven signs of growth at all.
The good news: getting a small business loan doesn’t have to be absolutely awful. Actually, it could be really fast and simple! Where traditional lenders see risk, National Business Capital finds opportunity. Secure your small business loan through National Business Capital in 4 easy steps:

  • Complete a 1-Page Online Application
    Or give one of NBC’s Business Financing Advisors a ring, who are always ready to listen to your story, and advise you on how to get started.
  • Pair With a Business Financing Advisor
    A Business Financing Advisor will contact you within 24 hours after submitting your application. Let them know how they can help find the perfect small business loan for you.
  • Get Approved in as Little as 24 Hours
    Sit back and relax—NBC will handle the rest. Your Business Financing Advisor will work with an exclusive global marketplace of 75+ lenders to get you approved for small business loan options with the exact terms and underwriting you require.
  • Receive Funds as Soon as 1-3 Days
    NBC’s Business Financing Advisors along with our in-house production team prepare all required documents for submission which speeds up the financing process. NBC’s Business Financing Advisors are known nationwide for their ability to secure their client’s access to funds FAST while guiding and consulting their clients through every stage of the financing process.

Get Your Small Business Loan Today!

Call National Business Capital’s team of Business Financing Advisors at (877) 482-3008, available 24/7 to listen your story, and work close with you every step of the way towards getting your small business loans. Or, fill out NBC’s 1-minute, 1-page application below to get approved in 24 hours or less.

Additional Resources

For more information on the steps every business owner should take before applying for small business financing, read the article below from FitSmallBusiness.com:

How to Get a Small Business Loan

how to get a small business loan quickly and easily
To learn more about how National Business Capital can get you the small business funds you need, when you need them, follow them on Twitter and Facebook: @NatBizCap
You can also @GrowByJoe on Twitter and Facebook for all the business financing advice and strategies you need to grow and improve your company.

National Business Capital & Services is the #1 FinTech marketplace offering small business loans and services. Harnessing the power of smart technology and even smarter people, we’ve streamlined the approval process to secure over $1 billion in financing for small business owners to date.

Our expert Business Financing Advisors work within our 75+ Lender Marketplace in real time to give you easy access to the best low-interest SBA loans, short and long-term loans and business lines of credit, as well as a full suite of revenue-driving business services.

We strengthen local communities one small business loan at a time. For every deal we fund, we donate 10 meals to Feeding America!

About the Author, Megan Capobianco

Megan is passionate about helping business owners along their journey - providing them with relevant content they can use in their day-to-day operations.

Disclaimer: The information and insights in this article are provided for informational purposes only, and do not constitute financial, legal, tax, business or personal advise from National Business Capital & Services and the author. Do no rely on this information as advice and please consult with your financial advisor, accountant and/or attorney before making any decisions. If you rely solely in this information it is at your own risk. The information is true and accurate to the best of our knowledge, but there maybe errors, omissions, or mistakes.