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5 Safer Options to Bank Loan.

Dele Akintilo

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Banks are agents of financial intermediation that are generally saddled with the responsibility of making loans/funds available for customers whenever the need for loan/fund arises.

However, since the global meltdown of 2008, banks have gradually been slowing down on giving out loans and have directly or indirectly discouraged borrowers from having access loans by enforcing more stringent loan terms and conditions, increased pricing and turn around time between application and approval of loans.

Recent finding however have shown that apart from banks, people in need of financial assistance in form of loan can exploit the following safer options to bank loan:

Micro lending

Microfinance Banks have over the years offered a safer escape routes for individuals and organizations seeking bank loan. MFBs have a faster turn around time (TAT) compared with mega banks. Also, the conditions precedent and conditions subsequent to loan disbursement are more flexible in Microfinance banks.

Supplier credit

This alternative applies to wholesalers, retailers, transporters and so on. As a wholesaler and retailer, instead of experiencing delays and facing stringent loan conditions from commercial banks, you could approach your line supplier to give you goods on credit and after selling them, you pay your supplier back. A transporter can take vehicles on hire purchase and pay back in installments.

Sales of assets

Assets like cars, buildings, machines and so on can be sold and converted to cash if they are of no use to anybody that needs fund. This option is a faster means of raising funds and is safer than taking bank loan.

Borrowing from friends and family

Rather than approaching banks for loans, one could approach influential and well to do friends and family members for financial assistance. Funds sourced through this means are easier to get and they come with no interest. Under this option, it is strongly advised that fund raisers should endeavour to pay back the borrowed fund as at when due as this builds trust in respect of subsequent borrowing.

Online lending platform

In addition to the options discussed above, loans can be alternatively sourced online as various online channels have evolved in recent times. Loans can be accessed from lending club, online lenders alliance, GADcapital.com, CAN Capital, Fundbox, Lendio, Kabbage, crowdfunding platforms and so on.