What are the main criteria for gearing up a new business? First and foremost is the willingness that will boost up your desire for venturing. And then, you must have a business plan, manpower and obviously a proper monetary resource, with which, you can cross the threshold of a business. Many a time, it is seen that people cannot set up their own business, due to cash shortage. To assist such kind people, new business loans are introduced.

New business loans are showing the easy way in funding for a new enterprise. A gamut of usages of these loans has grabbed many businessmen’s attention. Whether it is related to buy machines and equipments for the new business or to arrange a new office, new business loans are suitable for each and every requirement.

Not differentiating among borrowers, new business loans provide all borrowers a chance to establish their own businesses. These loans are available both in a secured as well as in an unsecured form. The obligation of pledging a security is attached to the secured option. Any valuable objects, like, real estate, automobile etc can play the role of security. On the other hand, unsecured option is meant for those borrowers who are unable to use anything as a security or do not want to use anything against a loan. However, with new business loans, a borrower can avail the amount, ranging from ₤ 5000 to ₤100000 for 3-25 years.

In this context, the difference between the secured and the unsecured option needs to be highlighted. Since, a secured loan is available against a security and the presence of the security covers the risk of lending money, thus, there is a possibility of availing these loans at a better interest rate. Oppositely, in case of the unsecured option, the absence of any security is the main reason behind the higher interest rate. But still, there is a positive aspect of this option, unlike the secured option; the risk of collateral repossession is not present here.

Nevertheless, submission of the following documentation is mandatory, while applying for new business loans:

•Borrowers should enclose the blueprint of their business plan with their application form
•The desired amount should be mentioned properly
•A borrower should give a guess estimation of his yearly turn over
•And submission of personal financial statement is compulsory as well.

Usually, through this documentation, lenders want to verify what sort of business borrowers want to start as well as the lasting capability of the business is also taken into account.

As one cannot drive a car without fueling it, same one cannot start a business without funding it. With new business loans, a borrower can overcome their cash crisis and set their eyes towards their own business plan.