Short-Term Loans: Understanding The Risks

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Real Estate Agent with Online Buzz

Short Description

Small Businesses need short term loans to overcome various business needs. However, they need to be careful about the risks associated and understand how short term unsecured business loans can help.

Amit runs a small retail store in Meerut, Uttar Pradesh. He offers small grocery and daily use items for his customers, while he has some regular customers things are getting challenging with the emergence of new stores that are larger and have a better layout and hence a lot of new customers get attracted to them. While modernizing the store is a long term bet he is more concerned about a lot of other risks that come along with running the retail store. Here are some of them and how they can be overcome with.

No Collateral

Amit needs short term loansĀ to cover for a lot of requirements. However, every time he applies for a short term loan with a traditional lender, they ask for collateral in the form of home or office properties and since Amit runs his business on a leased premise he is unable to get access to the short term business loans in India. This is where he got to know about the digital lenders and he approached Indifi with a request for online short term business loan and his request for processes within 24 hours. Amit was pleasantly surprised.

Margin Pressure

Amit needs to order goods in bulk to earn extra margin from the distributors and companies that he purchases the goods from. However, selling this stock takes its own time and thus Amit requires fast short term business loans that can help him to place orders quickly for high demand or items that are on offer and good help him earn better margins. Amit applies for short term unsecured business loans with Indifi, which is a top digital lender and as he got the decision as quickly as within 24 hours, he is able to mitigate the risk of margin pressure.

Customer Amenities

Customers are getting more exposure to the modern retail concepts and they are looking for a modern convenience even in the smaller stores and hence Amit needs to invest occasionally in setting up aisles and gondolas to highlight products and make it better to shop. While traditional lenders take weeks and months to process. Amit gets fast short term business loans with Indifi to implement quick Customer Amenities.

Repayment Risk

The traditional short term business loans have a standard repayment process and the retailers like Amit have to pay using equated monthly instalments, which becomes a huge risk as the business is not always alike and it goes through several highs and lows. This is where the short term unsecured loans with digital lenders help retailers like Amit as they offer flexibility to integrate repayments with customer transactions using card swipe machines and payment wallets, this mitigates the risk of repayments going astray.

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