Business loans can be essential when you’re launching a startup or looking for additional funding to expand an existing company. The funds are used to secure inventory, purchase equipment, rent operational space, hire employees or cover a host of other expenses.
According to a report by the National Small Business Association, in 2017 nearly three-quarters of small businesses were able to access the funding they needed to grow. However, financing remained a challenge for 27% of U.S. businesses. According to the NSBA report, businesses that were unable to secure capital had to take difficult actions, including reducing the number of employees and deciding not to expand operations, finance increased sales, or increase inventory to meet demands.
Since loans can be so critical to your business success, it is worth learning the most common barriers borrowers face when looking to secure a business loan. Once you learn about these roadblocks, you can take the steps to circumvent them and find the right type of loan and lender for you.