What is a Business Loan or Funding and How Does it Work?
A business loan* or funding is a financial arrangement in which a business borrows a specific amount of money from a funder, typically a bank, credit union or online funder for a specific period time. This borrowed capital is intended to be used for various business purposes, such as expanding operations, purchasing equipment, covering working capital needs, or other activities that support the business’s growth or operations.
Business loans or funding can provide crucial financial support for businesses, allowing them to invest in growth opportunities, manage cash flow, or navigate challenges. It’s essential for businesses to carefully consider their financial situation, the purpose of the loan or funding, and the terms offered by lenders before taking on debt.
*Not available in all states.