Digital Business Loans: The Fast and Flexible Way to Finance Your Company

Digital business loans are alternative business financing products that you can find online quickly. While they fit this basic definition, digital business loans can be very diverse products. 

In this guide, we will go over the basic benefits of digital business loans and some examples of how they work.

Digital Business Loan Benefits

The main benefits of digital business loans are speed and flexibility.

Faster Speeds

Compared with traditional loans, digital loans are faster to secure. For example, in the UK you can apply for a loan of up to £10.000.000 in less than an hour. In most cases, the entire process from the start to when you receive your funds is just a few days. 

Digital lending platforms make the process easier by streamlining the process:

1. They take your most basic information and your loan requirements.
2. You review a series of business loans that meet your criteria and that you qualify for.
3. You are guided through the entire process to make informed decisions.
4. While you are guided through the process, everything is streamlined by putting the crucial information front and center.

You can go through all of these steps from the comfort of your office. Most of it can be done from your desk with your phone and laptop. If there are any issues with the loan application process or if you have any questions, you can get responses faster. Many digital lenders offer service well after business hours.

Flexibility

There are business loans for lenders with a very wide range of:

• Personal and business credit scores.
• Times in business.
• Revenues and profits.
• Industries.

With a bank or credit union, you can get great rates and service. But if you have a less well-established business or a poor credit history, you may have a harder time. In cases where you need flexible terms, you can usually secure them with other digital lending platforms. 

For example, if you need a business loan in the Netherlands, you can get one for a period of 1-20 years. All of that comes with the same speed and the many choices you get on digital lending platforms.

Online Management

When you choose a digital business loan, you normally manage the repayment process through an online portal. You can make repayments and communicate with the lender online and you never need to visit a branch office. There are very few physical paperwork requirements and you can receive and repay all the funds from your office.

What Types of Digital Business Loans Can You Get?

There are two main types of business loans that you can get digitally:

1. Secured business loans.
2. Unsecured business loans.

Apart from these two types of term loans you can get, there are also rotating business credit products like business credit cards and lines of credit.

Secured Business Loans

Secured business loans require you to put up acceptable collateral in case the loan cannot be repaid. These loans are easier to get and come with much higher sums. Lenders are willing to lend you a lot more money if you can provide some security to offset their risk.

For example, this German lending platform can help you find secured loans of up to €5,000,000. But they can only help you get unsecured loans of up to €350,000. While you can get a decision from a lender for either in less than 24 hours, you can get more with collateral.

Unsecured Business Loans

If you cannot or just don’t want to provide collateral, you can still get sizable business loans fast. But if you want an unsecured business loan, be aware that:

• You can expect higher interest rates than if you provided collateral.
• The lender will not be willing to lend as high a sum.
• Your borrowing credentials will be more carefully scrutinized.
• You may be asked to provide a personal guarantee.

As with any business financing product, it pays to compare unsecured business loans online first. All it takes is a few minutes to ensure you get the best unsecured business loan you can qualify for. The stakes are often even higher with unsecured business loans due to higher rates and personal guarantees. So, take the time to review your options carefully.

How to Compare Digital Business Loans

The best way to compare digital business loans is with online comparison tools. Online lending platforms match borrowers with lenders based on borrower qualifications. Based on what you can qualify for, you will be matched with the best lenders and business loan products that they can intermediate.

The process is the same for most online lenders, regardless of whether you’re borrowing in the USA, Estonia, or anywhere else:

1. Select your desired loan balance and repayment team.
2. Provide your or your representative’s contact information.
3. Provide your business financials and credit history.
4. See and compare lenders’ offers.
5. Formally begin the loan application process.
6. Get approved within 24 hours.
7. Finalize the arrangement and the lender will send you the money.