Financing for SMEs is of great importance, and emerging businesses should keep this in mind, since having a loan is essential for them to have good growth.

SMEs are crucial for the development of jobs in the country, since it is estimated that they generate 72% of jobs, so if they close their doors it will end up affecting both the economy and a large number of workers.

One of the reasons why this can happen is the lack of financing, so SME loans are a useful tool that you have to know about.


What you should know about financing for SMEs

That is why below you will know the importance, the right moment and different credit options that can be considered.


Why is small business funding crucial?

External funding is essential because it prevents exploitation of internal resources.

By doing this, you can encourage the expansion of the company even when profitability is low or decapitalization is a possibility.


When is a good time to apply for financing?

In accordance with good management and administration of SMEs, financing should be requested when it is not thought that it is needed. The explanation is this:

Companies are constantly evolving and need to expand and have more liquidity. In other words, there is never a period when you do not need external resources, therefore it is always a good idea to think about asking for them. It is best to do this when business is booming so that you do not have to act quickly when you are losing money.


SME loan options:


Bank credit

The traditional alternative, but perhaps the least lax. Normally, requirements that not all small businesses can meet are requested, between an already considerable operating time, guarantees and commissions. Also, resolutions can take months.



It is a loan focused on the raw material for the development of products or services, under the commitment to pay in the future for said material received.



A product where a financial entity acquires the debt of an SME, and then sells it to third parties, in the form of securities. It works both in the medium and long term.



In this case, a number of organizations or people get together on a digital platform to fund a project. It is perfect for situations where little money is needed.



This alternative involves selling accounts receivable so that another organization is in responsible of collecting those resources, but in return it provides quick liquidity.



They provide a different financing option for projects that other financial institutions have turned down. They are made up of public limited corporations.


Merchant Cash Advance

It is one of the most flexible forms of financing, in which a company obtains a sum of money in advance and pays it with what it manages to sell, plus an agreed fee. It can be said that it is the purchase of a part of the future sales of a business.

Its flexibility lies in the fact that it is paid according to what is sold, for which the terms are not forced and the SME continues to earn, while paying the debt.

For all the options mentioned, keep in mind that you must demonstrate solvency and borrowing capacity.


You now know that appropriate financing, like the Merchant Cash Advance provided by Pymes Capital, with manageable conditions and a practically immediate resolution, is the ideal complement to efficient management and administration of SMEs.