Working capital financing: The best way to give a boost to your small business
A company’s working capital is measured by deducting existing liabilities from current assets. When the current liabilities are smaller than the current assets of a business, it is said to have positive working capital. Positive working capital means the business can pay off all obligations and still have the capital to invest in building the company’s other resources.
Why do MSMEs need working capital financing?
- Working capital financing is utilized to pay for the daily operational needs of a company. For example, these loans can be used to fund payroll, rent, and raw material purchases.
- The Working capital financing does not provide the company with long-term stability, but it can ensure that it is operational in the short term. Working capital financing lets a company take care of short-term obligations to concentrate on its long-term goals and accomplish them.
- Working capital loans are available for all types of companies, and the term of the loan depends on various factors, including loan amount and credit history.
Here are few customers who have availed working capital financing from Kinara Capital and are doing well in their business.
Lakshmi and Potala Venkat Rao
With the help of working capital financing from Kinara Capital, the couple was able to purchase stock directly from the mills and handle their online business competition. They hired more employees and have extended their reach by providing home delivery services. Now other small shops in their vicinity now come to them to purchase stock. They are hoping to double their turnover next year and are confident that they will surely reach the new milestone.
He came to Maharashtra in search of a job and found one. After a few years, he became a supervisor but wanted to do more with this experience. He decided to start his own business but he needed working capital financing to grow it further. With the first loan from Kinara Capital, he could buy raw materials in bulk and increase his range of products. He could also work on some major projects. When he started, he had four employees; now he has 12 employees, and his turnover has increased five times. Chandan said, “This was made possible only by taking loans from Kinara Capital”.
He had approached many banks, but they did not help. Finally, Kinara Capital approved his working capital financing loan in no time after providing all the required documents. With that first loan, he was able to nearly triple his turnover. This is because he could get more margins by being able to buy raw materials in bulk. After a year, he took another loan and used it to further improve his business. Now his goal is to hire 50 people.
For people like him who have started a new company, Kinara Capital offers a good opportunity. His suggestion to others who are setting up their company is to take a working capital loan from Kinara Capital because it can help them run their business with ease.
Various banks and NBFCs (non-banking financial companies) provide collateral-free working capital loans to small businesses. However, it is important to take a loan from a reputed and established NBFC like Kinara Capital. They have a hassle-free digital process that helps you get a loan disbursed in 24 hours. Start now with a 1-minute eligibility check on their website.