What options do small businesses have for loans and financing?

Graphic image of a box truck, delivery vehicle with cash flying out of the back of it - TAB Bank

by Justin Hatch, VP Commercial Finance

With many millions of small businesses operating across the U.S., it's simply inevitable that many of them will need support from a financial institution through a loan or financing. Whether your company has a strongly seasonal sales cycle, needs funding to develop and grow, has to address an unpredictable emergency or has another major financial need, small-business loans and financing can help. With the right solution in place, your company can address the issue at hand as well as have an understandable and manageable path forward for repaying the loan or financing agreement.

At TAB Bank, we pride ourselves on offering small-business financing and lending options that align with the needs of business owners and decision-makers just like you. Let's look at TAB's choices for loans and financing to help you understand the structure and applications of each.

Invoice factoring

In a wide variety of industries and markets, companies offer services or provide inventory to their customers, then wait to be paid for those offerings. The exact amount of time between sending over assets or finishing a service varies greatly based on a number of factors, but can easily last weeks or even months. Sometimes, the delay between using your business's resources and receiving payments in return can put financial stress on your operations. How can you address this delay when you need to spend money to keep operations going or address a major, time-sensitive opportunity?

Invoice factoring allows you to use those same bills not yet paid by your customers as collateral for a line of credit that provides you with immediate cash flow. You don't have to put up critical business assets to secure this line of credit - the only thing on the table are unpaid invoices. When you work with TAB, you enjoy fast approval times with funding available, in some cases, in as little as a day, as well as a streamlined online banking portal and a personal connection with a dedicated relationship manager. Learn more here.

Asset-based lending

One of the easiest ways to understand the concept of asset-based lending is to view it as an alternative to traditional lending options. That's also an easy way to grasp its unique advantages. While traditional lending choices are often restrictive and static, focused only on your cash flow and balance sheet. Asset-based lending, on the other hand, draws on accounts receivable, inventory and some types of equipment to offer more avenues for funding your business. This approach increases liquidity, allowing your company to access more money if needed, while using minimal financial covenants.

Just as with all of our options, our asset-based lending program includes the support of a dedicated relationship manager to help you make informed, thoughtful decisions about your needs. You can learn more about asset-based lending here.

Equipment financing

With solutions geared specifically toward the trucking industry, we're proud to offer an alternative to purchasing trucks and other necessary equipment outright or leasing it. Equipment financing allows your company to own its core assets without requiring you to make a major purchase up front, potentially placing significant stress on your cash flow and ability to address other financial needs.

Equipment financing is a powerful tool for ensuring your business has the trucks and related equipment it needs while spreading out the total cost of such a purchase. You can turn to equipment financing whether you're looking to purchase a new or used equipment, as well as refinancing an existing loan. You can learn more about equipment financing here.

If you have specific questions about our small business loan and financing solutions or simply want more information, get in touch with us today.  If you are looking for more options and more details about business lending you can access our whitepaper titled, "Effective Lending Options for Your Business," by clicking the tile below.


Effective Lending Options for Your Business

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