A great number of specialist concepts are used in banking and broadly defined finance, and a large number of them may be unclear to those not associated with this sector. Most people are undoubtedly familiar with terms such as mortgage or payday loan, but confusion can be caused by the phrase “business loan”, which is much less common. So what is business credit? Who gives it and what are its types?

What is an economic loan?

What is an economic loan?

The concept of business credit is relatively rare and can be interpreted differently, but most often it simply means a loan for entrepreneurs, which is intended for expenses related to the operation or development of the company. The vast majority of companies will probably find themselves at some point in their existence when needed will take a loan or other type of liability (for example, a non-bank loan). This does not even have to mean financial problems – often borrowing funds from a bank or loan company may simply be the most convenient solution in a given situation. It is worth pointing out that micro-entrepreneurs also have the opportunity to finance their activities not only with loans for companies, but also with loans for private individuals and often use this option.

Economic credit – conditions

Economic credit - conditions

Getting a business loan is usually a bit harder than getting a regular loan for individuals. This is because banks do not want to risk and grant loans to potentially insolvent companies.

Send loan application Only companies that have been in existence for at least 12 months can count on receiving a loan from the bank. In addition, factors such as the company’s turnover and whether it pays contributions to ZUS and the Tax Office are also important for the bank. Therefore, when applying for a loan, documents such as:

  • certificate of non-arrears with contributions to the Social Insurance Institution and the Tax Office
  • company bank statement
  • invoices.

Which business loan should you choose?

Which business loan should you choose?

After learning about the types of business loans listed above, the question may appear – which loan should you choose? Working capital loan, overdraft or investment loan? Each of these types of liabilities will work best in a different situation. A working credit facility is an interesting solution in the event of temporary problems, an overdraft can be a form of insurance in the event of an urgent need for additional cash, and an investment loan will allow the company to grow. which loan we decide, we should make sure that we use the most profitable offer and read the loan agreement carefully before signing.