YOUR COMPANY IS LOOKING FOR ALTERNATIVE LENDING SOLUTIONS!
SOURCES OF BUSINESS LENDING IN CANADA YOU CAN ACCESS TODAY
You've arrived at the right address! Welcome to 7 Park Avenue Financial
Financing & Cash flow are the biggest issues facing business today
ARE YOU UNAWARE OR DISSATISFIED WITH YOUR CURRENT BUSINESS FINANCING OPTIONS?
CALL NOW - DIRECT LINE - 416 319 5769 - Let's talk or arrange a meeting to discuss your needs
EMAIL - sprokop@7parkavenuefinancial.com
Alternative financing isn't something that most business owners and their financial managers equate with 'shopping.' Still, the reality in today's environment is that it's a requirement for your company to know what traditional and non-traditional small business financing solutions are available to your company.
WHY ARE COMPANIES LOOKING FOR ALTERNATIVE LOAN SOLUTIONS
Every day, more and more companies are looking at types of alternative 'non-bank solutions from credible lenders who can assist their business with lending options via cash flow, debt, and working capital financing solutions.
In some cases, it's somewhat of a 'forced' situation as some companies find themselves in what the banks term as 'special loan' situations due to any number of events that have triggered a default in bank covenants, loan payments, etc.
However, there is one immediate bottom line:
TURNAROUND FINANCING IS REQUIRED!
We'll take a look at different aspects of alternative finance solutions in Canada and a re-focus on key issues within that damaged bank relationship that sometimes happens in the world of banks and traditional financing.
THE LURE OF BANK INTEREST RATES - ACCESS TO CAPITAL OR COST OF CAPITAL
It's no real secret that interest rates in business lending for commercial business financing are at all-time lows when it comes to traditional banking. So even bank fees associated with business lines of credit and business loans are not all unreasonable. Nevertheless, damaged relationships with your bank can exist in certain scenarios that might even be about 'personalities, ‘i.e. the human side of the business.
DOES YOUR BUSINESS QUALIFY FOR BANK CREDIT?
Higher interest rates from alternative lenders are, of course, why many firms consider financial institutions such as Canadian banks as the go-to solution if they qualify for business credit under bank lending criteria for a term loan or line of credit or equipment loan.
As a business owner, you might often feel that Canadian banks, ie ' traditional lending ', or your own banker specifically does not 'understand' your business or industry. In fairness to Canadian bankers, they are sometimes just challenging a client and should often be viewed as a 'sounding board' for challenges your business might face
The limited amount of choice that owners/financial managers have when it comes to banks in Canada is, of course, a limited number of banks in a highly regulated environment. That's a good thing for banks and the health of Canada as a whole, but not so good when it comes to your business or your industry being able to achieve its financial and sales goals with the right amount of financing.
Of course, unlike the U.S., which has different tiers of commercial and business banking, with hundreds if not thousands of individual bank lenders.
In certain cases, your industry might be 'out of favour .' Traditional lenders are looking for ways to end relationships in certain economic sectors. With all due fairness to there being two sides of the story, we at 7 Park Avenue Financial can commiserate with the Canadian firms who suddenly find their total future and destiny in the hands of a third party.
As a short aside, probably the best advice we can give a client is to choose a relationship-oriented banker with internal credibility within her or his bank. Our belief - all banks are the same; all bankers are not the same.
WHAT ARE THE ALTERNATIVES FOR CANADIAN BUSINESS FINANCING SOLUTIONS FROM ALTERNATIVE FINANCE LENDERS?
Using our 'shopping analogy,' there are some solid choices when it comes to business funding.
Alternative Financing For SMEs In Canada:
Solutions and financial products & Services include:
Asset-Based Finance Firms
Equipment Lessors - Sale-Leaseback Specialists
Accounts Receivable Financing / receivable loans/lines of credit
Inventory Financing
Purchase Order Financing / Alternative Sales Financing For Procurement
Royalty Financing
P2P Lending - online solutions - Popular in recent years, these loans use technology and ' algorithms that are gear toward small business loans and fast approval
Merchant Cash Advance - short term working capital loans - good owner credit score/ personal credit history required - easily accessible but with a higher interest rate
Tax Credit Loans (Primarily SR&ED)
Key Point: Any of these alternative finance solutions can be combined in various manners to allow for full-scale financing of your sales revenues.
CONCLUSION - ALTERNATIVE LENDING CANADA
Speak to 7 Park Avenue Financial, a trusted, credible and experienced Canadian business financing advisor with a track record of business financing success who can assist you with achieving refinancing needs and financial advice and solutions that make sense.
FAQ: FREQUENTLY ASKED QUESTIONS
What is alternative lending?
Alternative lending is a form of financing that provides funds to businesses without having to go through a traditional bank. Alternative lenders in the alternative lending industry are able to work with borrowers who have a shorter track record, no collateral or simply need the money as soon as possible, often, but not always, in return for higher interest rates on the loans.
Alternative lending may offer different types of alternative lending such as peer-to-peer loans, invoice financing and crowdfunding. Businesses can get an edge in the market by being open to alternative lending options when searching for funding when looking for a loan.
What are the types of alternative lending?
Alternative lenders offer simpler, faster application processes that require less effort. Many times you’ll be getting the money within the next few days or weeks. With flexible requirements and streamlined applications, alternative lenders make financing accessible to small businesses.
Each lender offers different product types, short-term loans, lines of credit, invoice financing, etc. There are many different business lenders that offer different types of alternative financing options, with some of the most common offering being offered. The best alternative lenders to small companies offer flexible requirements, streamlined applications and simplified loan and credit applications.
What is A business line of credit?
Alternatives to a short-term line of credit may be a good option for a business. Non-bank lenders offer quick, easy and stable access to funding. The market terms vary widely depending on the company and its business needs
What is invoice financing/factoring?
Invoice financing is a popular alternative loan compared to traditional banking loans. With invoice financing, a lender advances funds secured by accounts receivable, your unpaid invoices. Invoices themselves serve as collateral on the loan. Funding is typically 85% - 90% of the value of the invoice. The remaining is paid to the business when customers pay. Invoice financing is a form of asset-based lending.
What are the most popular type of alternative loans in Canada?
Factoring and receivable financing are the most widely used forms of alternative finance from an alternative lender solution point of view. The best alternative lenders offer access to capital that would not be available from traditional banks or equity funders.
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