Introduction
Let’s say you possess the skills necessary to be an entrepreneur. You also have a novel business idea and a detailed plan that outlines the steps needed to bring your vision to life. To top it off, you’ve done your market research and even crafted a marketing campaign for your enterprise. Even with all of these combined, you still lack one crucial component to start a business: capital.
Without capital, you won’t be able to purchase equipment and supplies to produce your products. You also can’t hire workers or pay for business registration expenses.
Having insufficient funds is a common obstacle faced by many aspiring business owners. Thus, they either find investors or take out a business loan. The latter can be a more viable option becacse you do not have to convince other people to fund your business.
Cebuana Lhuillier Kanegosyo Center offers loans to help Filipinos start or expand their enterprises. Moreover, we came up with this guide to enlighten them on what they need to know about taking out business loans. This is all part of our mission to make doing business easier, fairer, and more accessible for all.
Are Loans Advisable for Beginner Entrepreneurs?
Often, Filipinos building their business from scratch do not have enough money on hand to use as capital. As a result, they turn to banks, private lenders, or the government to take out a loan. Given the many cautionary tales about debt, you may wonder, “Is it advisable for beginner entrepreneurs to secure a loan?”
The truth is, there are many good reasons to apply for a business loan. Here are a few examples:
- Start-Up Capital – A business loan can provide you with capital to get your business off the ground by covering various expenses, such as machinery, raw materials, legal fees, and so on.
- Full Control – One of the disadvantages of getting funding from investors is that they usually demand a certain level of control over the business in exchange for their investment. With loans, you won’t have to worry about this.
- Lucrative Business Opportunity – Sometimes, we are presented with a business opportunity with a huge chance of outweighing the risks of taking out a loan. In this case, applying for a loan can be a wise decision.
- Build Your Credit – Applying for loans is a way to improve your business’s credit score. Having a good or high credit score can help in securing future loans at lower interest rates. Just make sure to repay your debt on time.
How Can Loans Help You With Your Business Goals?
Below are some of the ways Cebuana Lhuillier Kanegosyo Center’s loans can help you achieve your business goals:
Expand Operations
A loan can help you expand your business by opening a new branch or hiring more workers. Doing this is necessary if you get more customers or demand for your products.
Purchase Inventory
Sometimes, you will come across an opportunity to purchase huge quantities of supplies at a discounted price. Also, depending on the season, you may need to buy inventory in bulk to prepare for the influx of customers. Getting a loan can help you cover these necessary expenses.
Buy Tools and Supplies
Of course, you will need various tools and supplies to manage orders, create products, and so on. Depending on the type of business, you may need office supplies like paper, tape, and scissors, as well as tools such as printers, laminators, and computers. Again, getting a loan can help you cover these costs.
Questions To Ask Yourself Before You Get a Loan
Applying for a loan entails preparation. Before you head to a lender, you must answer the following questions first:
How Much Money Do You Need?
How much money you will need will depend on a couple of factors. First, identify the purpose of your loan, which will usually depend on your business goals. Consider also your business’s sales to gauge your capacity to pay your loan within its term. Moreover, think about any unexpected business expenses so you can include them in calculating the amount of money you need.
What Do You Need the Money For?
Do you need to purchase new supplies? Perhaps you need capital to fund a marketing promotion or help your enterprise recover from an unfortunate event. Knowing what you will use your loan for will help determine the type of loan you need to get. For instance, if you need funding for a long-term project, such as a business expansion, a long-term loan would be more suitable.
What Does Your Credit Profile Look Like?
Lenders will evaluate your credit profile to assess your capacity to pay off your loan. Now, how do you know whether your credit profile looks good or bad? Check your credit report. According to the Credit Information Corporation (CIC), your credit report summarizes your borrowing and repayment activities.
You can get a copy of your credit report, including your credit score, by downloading the CIBIApp. This app was recently launched by CIBI Information Inc., one of the accredited credit bureaus of the CIC.
What Would Be the Interest on Your Loan?
Borrowing money comes at a cost. This is known as loan interest and is how lenders profit from lending their money to other people. There are two ways to calculate loan interest: amortizing interest and simple interest. Of the two, simple interest is more straightforward and follows this equation: principal loan x interest rate x loan term = interest.
On the other hand, calculating amortizing interest involves more steps. Whichever method your lender follows, make sure to have this clearly explained so you know exactly how much you need to pay each month.
Pick the Right Cebuana Lhuillier Kanegosyo Center Loan Bundles for You!
Wouldn’t it be great if you could get your hands on a service package that includes business loans and other necessary products to kickstart your business? You can do it now with Cebuana Lhuillier Kanegosyo Center!
We offer the Simula Bundle, which includes loans, savings, insurance, and other products to help aspiring entrepreneurs start their businesses. Meanwhile, business owners looking to expand can get the Paglago Bundle, designed to be their partner as they grow their enterprises.
Simply sign up to become a member to get access to these business bundles!
How To Apply for a Loan
To apply for Cebuana Lhuillier Kanegosyo Center’s business financing, follow these steps:
- Sign up to become a member.
- Select either the Simula or Paglago Bundle.
- Fill out the application.
- Complete E-KYC (ID and Liveliness Check).
- Wait for approval. (Results will be pending if more information is needed).
- Submit documents via email.
- Review of documents.
- Wait for an SMS of approval.
- Confirm loan.
- Wait for a one-time pin (OTP) for confirmation.
- Get approval SMS.
- Get disbursement SMS.
- Read monthly SMS reminders.
Please don’t hesitate to contact us if you have any questions or concerns or need assistance with the application process.
Frequently Asked Questions About Cebuana Lhuillier Kanegosyo Center Loans
Do I Need To Be a Cebuana Lhuiler Kanegosyo Center Member To Get a Loan?
Yes. You must first become a member to access Cebuana Lhuillier Kanegosyo Center’s products and packages. Membership is free and does not have an expiration date.
What Are Cebuana Lhuillier Kanegosyo Center’s Loan Requirements?
You need to provide the following documents to apply for a loan:
- Valid ID
- Latest ITR
- Latest Business Permits
Note that you may be asked to provide other business-related documents.
Where Can I Apply for a Cebuana Lhuillier Kanegosyo Center Loan?
There’s no need to leave your house to apply for our business loans because the application process is done online via our website. Simply follow the steps previously discussed above.
Conclusion
Securing funds is one of the first steps to business success, and for many beginner entrepreneurs, it is also one of the hardest. Thankfully, you don’t have to search far and wide to find a loan suited to your business needs. With Cebuana Lhuillier Kanegosyo Center’s start-up loans, achieving your entrepreneurial goals becomes all the more possible.
What are you waiting for? Take the next step to turn your business idea into an actual enterprise: Sign up to become a Cebuana Lhuillier Kanegosyo Center member to take advantage of our financial services today!