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In the lending category, one of the biggest barriers to entry is the perception that somehow borrowing is bad. A sign of failure. Here I tackle those negative perceptions head on in this article for Ultimate finance.

MYTH 2

It’s harder to get a loan in today’s economic climate

Not at all. Loan providers are finding that businesses aren’t asking to borrow. Possibly because the media has made us believe that lenders aren’t lending – which simply isn’t true. In the past 16 years we’ve lent over a £1bn in funding and we’ve no intention of stopping any time soon.

The way we look at it is this: Are you asking for a loan to help your business become more profitable? Yes? Then that’s what we’d call a no-brainer.

MYTH 3

A good business should be able to manage their cash flow

Businesses need working capital to survive. Fact. What’s also fact is that businesses have to invest in supplying their product or service before their customers offset the cost for them. If you’re like any business we know, you’ll also find that your own suppliers never pay as quickly as you’d like. A temporary loan can help you keep that cash flow flowing nicely, so yoou devote your attentions to chasing new customers, not suppliers.

MYTH 4

Borrowing is bad for profit

That depends on why you’re borrowing. If the investment’s going to bring you in more money than the cost of borrowing, that’s definitely not ‘bad’ by any stretch of the imagination. Strategic borrowing can help you expand your orders and increase your client base – in short, make more profit. Successful businesses know how to use short-term loans to help them seize the moment. What is bad for business is lack of investment and letting great opportunities pass you by.

MYTH 5

Loans are risky – and expensive

That depends on who you ask. Ours are as transparent as they come with no set up fees, no early repayment fees, and no exit fees. It’s the way all loan providers should work – but don’t. Many businesses look at short-term loans as being an essential part of business planning. Imagine if you weren’t able to weren’t able to take on a new order simply because of cash flow?

When you’re working out how much the loan is going to cost, it’s just as important to work out how much it could cost you if you don’t. Added to which you can get Corporation Tax Relief on the interest – so it’s win-win.

MYTH 6

A bank is the best place to get a loan

The first place that springs to mind is likely to be your bank. You already have a relationship with them and well…it can seem easier. Except it’s often not. There are other lenders out there who can offer you fairer rates and get you the money you need, quicker – often with a lot less paperwork.

At the risk of blowing our own trumpet our rates are fair (and more to the point, completely transparent) with a Cash Advance that’s the fastest in the market. Money-in-your-account-in-less-than-12 minutes, fast. If you’re bank has an unbeatable loan offering, then great. But if not, talk to us.

MYTH 7

Loans take time to approve

They can, but they shouldn’t. We can do all the checks we need based on trading history, payment performance and director experience in a super-fast matter of minutes. And we also have a pre-approved amount of cash available for every business in the U.K (with no credit footprint) so you can get the funding you need as soon as humanly possible.  After all, a slow loan is as much use as no loan.

MYTH 8

Loans are a built to trap you 

It’s true that some providers try to entice borrowers with loans that you give you years to pay back. But who wants spend years paying anything? Especially as each passing month brings another chunk of interest with your name on it. That kind of lending definitely isn’t us. We want to help businesses, not put a millstone round their neck. We offer short-term solutions as well as borrowing that you can spread out over a longer period if that’s what you need. And we don’t bury anything in the small print. We do fair lending that puts the borrower first.

MYTH 9

A business loan should always be a last resort

This is the biggest myth of all. Over the years we’ve all been hard-wired to equate loans with debt and therefore something that’s ‘bad’. But what a loan is, is essentially funding. Funding which could be essential for the success of your business.

We don’t think twice about borrowing a lump sum over 25 years to buy a house. Why? Because we call it a mortgage, not a loan. But a loan is essentially what it is.

Successful businesses don’t have a block with semantics. To them, a loan is simply a strategic source of funding. A way to create opportunity. Which is what all businesses should be in the business of doing.