In the midst of the global economic crisis, many
small businesses are on the brink of closing down if not enough capital
infusion is found. It is now even more difficult to get small business
loans from banks, though. Ironically, the exact reasons why small
businesses need such small business loans – the fact that business has
slowed down and profitability has plummeted – are the same reasons why
banks turn them down for loans.
Small businesses now have to be more resourceful in finding
alternatives to small business loans.
Government Grants and Contracts Instead of Small Business Loans
The American Recovery and Reinvestment Act signed by President Obama in
February 2009 caused the pumping of billions of dollars for the
revitalization of the economy. Because of it, there are plenty of
government grants and contracts available to small businesses. These
can be alternatives to small business loans.
But how can small businesses avail of the stimulus program?
The Association of Procurement Technical Assistance Centers (APTAC) has
the responsibility for helping small businesses obtain and perform
federal, state and local government contracts. It has Procurement
Technical Assistance Centers (PTAC) throughout the country, ready to
help small business owners to get registered and find opportunities in
the area of government grants and contracts. Counselors assist small
businesses in filling out bids, proposals and quotations.
The PTAC holds seminars teaching small business owners all the ins and
outs of government legalese, including acronyms and registries. A
one-day seminar with PTAC covers what small business owners may take
months to learn on their own.
The PTAC then helps small businesses with Central Contractor
Registration (CCR), a requirement for doing business with the federal
government. This registration can be so complicated that some companies
take two days to do it when the PTAC counselor can help them get
through it in 15 minutes.
Local PTACs will be of help in acquiring state and municipal contracts.
Other resources that small business owners should consult include the
Small Business Administration (SBA) which also coordinates with the
APTAC; the General Services Administration (GSA) which acts as the
government’s purchasing department and provides information on becoming
an approved vendor; the Federal Business Opportunities website
(fbo.gov) where federal contract opportunities currently available are
posted; and the Small Business Innovation Research website (sbir.gov)
where grant and funded research opportunities for small businesses are
listed.
Cash Advances from Credit Card Services Instead of Small Business Loans
Another alternative to small business loans are cash advances from
credit card services. This option is much easier than winning
government grants and contracts.
Most small businesses are already availing of credit card services that
enable them to accept payments by credit cards or debit cards. This is
practically a requirement to doing business these days, with people
hardly paying cash for goods and services. Many small business owners
do not know that they could avail of cash advances from these credit
card services, though, and that such advances can actually equal small
business loans.
The amount that a small business can borrow is based on its average
monthly income from credit card sales. This is so because the cash
advance does not require collateral and future sales receivables from
credit cards stand as the collateral. Payment will also be done through
automatic deductions from those future credit card sales. There will be
no set monthly amortizations. Instead, a certain percentage of the
sales will be allotted as payment. The small business owner, therefore,
need not worry over where to find cash for loan payments.
Cash advances from credit card services are the best bet of small
business owners as alternatives to small business loans.
Article Source: http://
www.articlesbase.com/loans-articles/finding-alternatives-to-small-
business-loans-1039581.html
About the Author
Advanced Merchant Services
Contact Name: Roger Inman
P.O. Box 1475 Safety Harbor, FL 34691
Bus: 727-642-3606
Bus Fax: 877-413-6067
E-mail: rinman3@tampabay.rr.com
Website: www.bankcardprocess.com
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