Loans for entrepreneurs, what do they consist of?

loans to entrepreneurs

Coming up with a brilliant idea for a major project can be exciting. But its execution can be stopped in its tracks without adequate financing. Here we will talk about the loans to entrepreneurs, a good option for initiatives with humble resources.

Loans to entrepreneurs: a way to build your project

The loans to entrepreneurs they are quite a viable possibility for many young people with great ideas but empty pockets. We know the feeling; we have just graduated from university, we are full of new knowledge and ideas to apply it in the real world for the benefit of many, but we hit the wall of unemployment or routine work caused by the need for subsistence.

Or we have been fortunate to find ourselves in a very creative work environment, within a brilliant work team, but our ideas do not match their purposes. Then we begin to think of our own initiatives that allow us to carry out our dreams. But the first step is to find resources to boot.

What then are the loans for entrepreneurs?

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Well, simply in what its terms express, a loan granted to people with a specific initiative so that they can develop it broadly and promptly. These can come from both private and public groups, especially if the project involves some public benefit, as well as from renowned banking entities.

Since it is about supporting entrepreneurs with low economic resources of origin, the loans are usually quite friendly in terms of payment terms and interest. But of course, in the relationship with banks, everything can depend on a good credit history and how it combines this with the amount received to repay later.

Low amounts (1000 pesos, for example in certain cases) usually imply short payment periods. If it is an ambitious endorsement of good amounts (150.000 pesos or more in other cases), logically the payment term will be extended. That is why credits can be observed for monthly, weekly or even daily payment ventures and then see credits that take even years to be paid.

Again, it always depends on the magnitude of the initiative, one's ability to pay and the amount of financial support. But it also depends on the format used to apply for the loan. The format that reigns at the moment is, obviously, the online stage.

If you have a special interest in everything related to business initiatives, you may also find it useful to visit this other article on our website dedicated to exposing how to run a business correctly. Follow the link!

Advantages of loans to entrepreneurs

Listing the benefits that can bring to the entrepreneur the fact of requesting a loan adapted to their situation can lead us by itself to productive, constant and payable financing. Let’s see then some advantages for this type of loan:

  1. As said before, business loans are usually quite flexible. This flexibility is of vital importance for any entrepreneur, particularly those embarking on a first business venture, due to the volatility and unexpectedness associated with first experiences. Most of the loans of this style therefore contain the possibility of restructuring the agreements, agreeing on new amounts or terms if necessary.
  2. The security of these loan services for initiatives is quite guaranteed, provided that those that are recognized by State agencies such as the National Commission for the Protection and Defense of Users of Financial Services (CONDUSEF) and the National Banking and Security Commission are followed. Values. The work of these entities in Mexico contributes a lot to making loan methods reliable.
  3. Entrepreneur-oriented loans are also usually characterized by the ease and speed of the startup process. Bureaucratic requirements are reduced to almost a minimum and the online platforms where these credits are usually made allow practically instantaneous shipments and responses. The request approval message can arrive as soon as the next day, while the payment usually takes no more than a few hours.
  4. An advantage derived from these well-established online credit contacts in Mexico is the convenience of remote communication, versus the traditional method of going to an office, necessarily at a certain time, often far from your home, to wait. a turn.
  5. It goes without saying how beneficial this format is in the context of the health crisis unleashed by the pandemic that began in 2020. In a situation of restricted movement, physical proximity and indoor meetings, applying online is obviously much more responsible. This type of loan has good platforms just for this work.
  6. Finally, these types of loans to support entrepreneurship are not limited to a specific work area. The support can be adapted to whatever you propose or you can find patrons interested in supporting exactly what you are trying to promote. Versatility is the norm in this area.

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Basic requirements for entrepreneurship loans

Given this versatility of nature within the possible lending organizations, both in their capacity as private, public or banking companies, it is reasonable that the requirements for the credit application vary in each case. However, the required elements are usually quite simple and can be summarized in the following recurring series of items:

  1. The first, logically, is the documentation associated with one's own identity. This document may consist of the Mexican professional license, the credential issued by the State to be able to vote in national elections, or the passport. The important thing is that the document is valid and formally indicates the identity with names, surnames and a recent photo.
  2. It is also necessary to present within these requirements a proof of address that proves that the applicant truly resides in the Mexican nation, to ensure a smooth financial deposit and continuity of contact. The document needs to be current to fulfill its verification purpose.
  3. It will also be essential to present the Unique Population Registry Code (CURP), the identification document based on an 18-character alphanumeric code. Every foreign legal resident or citizen in Mexico has their CURP, necessary for all types of procedures and requests such as the one at hand, so it will not be a long search to obtain it.
  4. A proof of training that ensures having completed a professional training process must also be presented in this package of requirements. The voucher must be valid for a maximum period of one year.
  5. Finally, all that remains is to attach the entrepreneurship loan application document, written according to the standards established by the organization in question that will provide it, if the application is accepted.

Essential tips to face the application for loans to entrepreneurs

There are certain factors that must be carefully considered when applying for a loan for your business. It is not something that can be done without a cool head, guided by the feverish enthusiasm of the moment. Let's review some of these aspects to place ourselves within the loan with a firm footing:

  1. In the first place, all the financing options that can be found should be thoroughly investigated, carefully examining their terms, small clauses and conditions to avoid manipulation or confusion in the future. It is also important to specify the work approach that the lender has, to weigh whether it is really adapted to our needs.
  2. Many options are really very positive but they do not adequately match the objectives of our enterprise or its nature. Let us then consider things with the utmost tact.
  3. This leads us to the next consideration. A hasty search for external financing cannot be executed if we are not clear about our objectives as a company. What this new income is going to be used for and how central it is going to be to our strategy needs to be carefully evaluated.
  4. The needs that were apparently sought to be covered by the loan can be illusory if they are put on a scale and can end up being a search for debts instead of a solution. Therefore, let's make sure that the venture really depends on this credit before getting hooked on a contract.
  5. The next factor that must be integrated with common sense in our search for financing is the internal organization to deal with it. Many times small businesses looking to get off the ground forget that a loan entails the need to have a thorough and well-established internal accounting structure.
  6. Not having it can even compromise the regularity of payments to the benefactor, which in extreme cases of default can be truly catastrophic for a business that is barely growing. In addition, having all the paperwork in order for all the obligations can make the difference between a small or medium-sized company with an amateurish tint and a company with ambition and professionalism.

What is the process to request a loan for entrepreneurs?

At this point we must also ensure that the process changes depending not only on the chosen lender but also on the means by which contact was made with him. In addition, there are Mexican web pages that function as intermediaries that bring together all the different contact options and that in turn present different steps to complete the loan application process.

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Even within this variety, we can identify some basic steps, unifying the different routes in the same list. Basically, the logic of many of these items remains the same.

Basic process:

  1. If you have decided to use one of these intermediary web pages between lenders, as is the case with financer.com, for example, the first thing you should do is log in or register on the selected page. Next, you will be able to access a screen where you can choose both the amount you want to obtain from the loan and the tentative date on which you can execute the repayment.
  2. The system will immediately display the different options of lenders that best fit your financial requirement and your repayment capacity. There are standard names that will always appear in the Mexican context, such as Kreditiweb, Kueski, askRobin and Credy, to name a few. By selecting one of these entities and clicking on the option that indicates Begins, you can have direct access to the chosen company.
  3. If you are not using any intermediary page because you have already located your preferred loan option, you can directly start the process in this step. Normally, most of the pages of the different entities will also require you to register to continue the request.
  4. Once this is done, a process of filling out online forms will begin, where the reason for the loan must be specified, the amount required and the tentative term proposed based on the payment capacity itself, as mentioned above.
  5. It is usual for the system to then request the upload of the documentation described above associated with identification by means of an identity document, registration key, address, training certificate, within a format where the loan request can be made formal.
  6. Once everything required has been filled out, uploaded and sent, a pre-approval notice may be received in a positive case. This notice will be accompanied by the loan contract, specified in all its parts with respect to amounts, terms and termination dates.
  7. We will make sure to read everything carefully to avoid misunderstandings or confusion that are difficult to fix in the future. If everything is correctly adjusted to your request and expectation, you can inform that you accept the document.
  8. At this point, a waiting period will begin before receiving the communication of full approval of the loan. As has been pointed out before, this period can be quite short given the speed of the processing processes through the network, many consisting of a maximum of one day or a few hours. Between the approval notice and the first deposit there is usually not much time, usually it is immediate.
  9. Once the credit is received, you will be able to start your business with better resources and make it fly with better wings.

Alternatives for loans for entrepreneurs

In the event that for one reason or another the format of the loan entities does not work for us and we need another source of financing, we will have to resort to different modalities to fulfill our purpose. We can name some of them to be clear about the parallel paths for growth with external support:

  1. A very popular option in these times of large and dynamic collective initiatives is crowdfunding. This is nothing more than a kind of community patronage of an attractive project, carried out through online platforms, mostly. Crowdfunding can be stimulated by rewarding contributors, which can consist of obtaining products or even earning business shares.
  2. Angel investors are another resource that can solve more than one problem in the start-up company. These are private financiers who provide not only the necessary loan but also decisive financial advice.
  3. Contests organized by different well-known brands or foundations with significant resources can be an excellent option. In this case, it is not a direct request, but the exhibition of your project before a jury at an event, in competition with other initiatives. If you win the contest, this will imply an important sum of money for your cause.
  4. The so-called Venture Capital is another financing option by funds that invest in recent high-risk companies because they are only in the first stages of their evolution. This has a price: the granting of a significant percentage of the shares of the new company.

The following video explains in detail the notion of lost government funds, a different option to obtain financing for your initiative under the grant format, and the situation of the system for the current year 2021. So far our article on the loans for entrepreneurs, the systems of its supplier entities and also the alternatives. See you soon and good luck in your paperwork and financing.


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