4 Types of Business Capital Loans Every Owner Should Know

Business capital loans matter because micro, small and medium enterprises (UMKM in Indonesia) play a significant role in building the national economy. That is why both the government and private companies actively support UMKM operators with business capital loan services. If you have a business idea that has not yet taken shape, it does no harm to start considering these financial services. First, though, get to know the types of loans on offer:

1. Business Capital Loan

The first is a business capital loan for starting your company. This type of loan comes in a wide range of amounts, from small to large, so you can match it to the capital your business needs. For repayment, financial service companies generally allow one year of installments at an interest rate agreed between both sides. Quite flexible, right?

2. Investment Loan

You can also try an investment loan to build your business. Unlike a business capital loan, this loan covers the cost of setting up or expanding a business, such as buying goods for rehabilitation and modernization. Investment loans are just as flexible, with varying amounts to invest and a repayment period of up to 5 years.

Most banks provide an investment loan for only 80% of the total capital required. So if you want an investment loan that covers the full amount, you should go through a financing company such as CSUL Finance. You can get forklift leasing together with an investment loan so your business runs efficiently.

3. Secured Loan

Next is the secured loan. This type of loan requires you to put up valuable assets as collateral, such as a BPKB (vehicle ownership document), a land certificate, gold, or a time deposit. Secured loans offer relatively lower interest rates and longer repayment periods, which makes them a good fit if you need a fairly large amount of capital.

4. Unsecured Loan

The opposite of the previous type, an unsecured loan is the one to choose if you do not need much capital, because the interest rate is fairly high. On the plus side, you are not required to provide any collateral, so you do not have to worry about losing valuable assets if problems come up later.

Those are the 4 types of business capital loans that can help solve your business's capital shortage.