MetronaijaTips finding private investors for business by amalankomputer: Entrepreneurial capital is required for business startup. Typically, a large amount of capital is needed for a business. Entrepreneurs eagerly seek out loans from investors for business capital because of this. The availability of company capital loan services is increasing along with technological advancement. However, you must exercise caution both while looking for a private investor and when requesting a company capital loan.
Know what investing is and who investors are before approaching them for venture funding. Did you know that there are several types of investors who could provide your business with the funding it needs? Let’s look at the investment explanation and safe ways to locate a private investor to get a loan for working capital in the article that follows.
Investment and investor
Understand the definition of investment before we discuss which investment is best for your business. The Big Indonesian Dictionary (KBBI) defines investment as putting money or capital into a business or project with the intention of turning a profit.
A person who invests money or capital in a business with the intention of profiting is referred to as an investor by the KBBI. An investor is a person who makes investments, to put it simply. Investors want to maximise their returns given the level of risk they are ready to accept.
Private investors (individuals) and institutional investors (businesses) are the two types of investors. Financial institutions and banks are institutional investors. Private investors, on the other hand, are individuals who make investments for themselves rather than for businesses. The majority of people believe that finding a personal investor is simple, but as an entrepreneur, you must be wary of fraudulent personal investors.
The reason is that it’s feasible that you can end up having to pay an excessive amount of interest if you borrow business capital from a fictitious individual investor. There are plenty of qualified personal investors who are registered and licenced with the Financial Services Authority (OJK), so there’s no need to fear if you’re looking for them.
How to safely find a personal investor
For business owners looking to raise funds, there are several financing possibilities accessible. Of course, you have to make sure that the private investor you select is a capital supplier who conforms with rules and laws. Both have to do with conditions, fees, and loan guarantees. By doing this, you lower your chance of falling victim to business capital loan fraud.
Here are some surefire ways to find a private investor for your business:
Finding private investors through fintech peer-to-peer (P2P) lending
P2P loans are a good alternative if you’re seeking for a personal investor, or you might say a business capital loan, starting from this point. You can apply for loans directly from creditors with the use of technology in the form of an online platform, which has simple conditions and a simple procedure.
In fact, some P2P fintech lenders provide unsecured loans for working capital. For business owners, such as micro, small, and medium-sized firms (SMEs), who lack collateral, this is undoubtedly advantageous. However, it must be remembered that the interest rate given will be considerably larger than the interest charged by banks.
Are you interested in investing in P2P loans? Keep the following in mind when applying for a loan:
- Pay close attention to the provided interest rate
Potential borrowers are definitely enticed by the fast and simple loan application process. The proposed interest rates, though, should also be taken into consideration. In order to make up for the simplicity of the conditions, some P2P lenders establish relatively high interest rates. A maximum lending cost of 0.8% per day has been established by the Indonesian Pool Fintech Fintech Association (AFPI).
The recommendation is to pick a P2P loan site that, given your financial situation, gives the lowest interest rate. To avoid feeling overburdened when the return date approaches, be aware of the hazards.
- Get a loan depending on your production demands
The OJK recommends borrowers to borrow money in accordance with their practical need. You should ideally not borrow more than 30% of your income. You will therefore find it easy to pay back the loan. Keep in mind that you must, of course, make payments for necessities of life. - Remit fees on time.
You should pay great attention to this topic. To prevent late fines, make your loan installment payments on time. As a reminder of the deadline, you can set an alarm on your mobile phone calendar.
When making company capital loans using P2P lending platforms, being mindful of the three points mentioned above can help you remain composed and responsible. Despite the abundance of fintech P2P lending possibilities, pick a reliable individual investor. Alternatives to traditional P2P lending for business capital loans are listed below:
Danamas (PT Pass Dana Pinjaman).
Within the scope of Sinarmas Financial Service, PT Pasar Dana Pinjaman developed the P2P lending platform known as Danamas. The DOK has granted Danamas services a licence and registered them. The best choice for you to borrow money from is Danamas if you are the proprietor of a microenterprise. Danamas is dedicated to assisting the microenterprise sector with funding for working capital, which is the reason.
PT Pinta Inovasi Digital’s Asetku
KTA Asetku is a cash lending product offered by Asetku. Those of you who are seeking for a personal investor with a quick and simple approach can apply for cash loans through Asetku. In 5 minutes, you can apply for a direct cash loan. Quite intriguing, huh? The KTA Asetku loan’s nominal amount is modest, nevertheless, and it has a brief maturity.
With a maximum amount of Rs 500,000 to Rs 3,000,000 and a maximum duration of 22 days, this fast cash loan is available.
PT Uangme Fintek Indonesia, often known as UangMe
UangMe is the following P2P lending fintech that you can use as a private investor. Loan payments made through UangMe for business financing will be made immediately into the borrower’s account. You can request a loan between 400,000 and 4,000,000 rupees for a four-month term. Daily commission variations can reach 0.79%.
You need to wait one to three days for the verification process. Your cell phone number will be used to contact you by the UangMe verification team. You will get a short message (SMS) if the verification process is successful. A maximum of two days must also pass before the distribution process begins.
Finding private investors through bank loan products
Applying for a bank loan is more difficult than applying for a loan online, which is simple. Banks have a lot of specifications. For instance, there are stringent credit requirements, a drawn-out approval process, and a need for a credit card for borrowers.
Banks, however, can still be a choice for people looking for individual investors. in particular for MSMEs. Be cautious; there are benefits to bank business capital borrowing as well. like a few of the advantages listed below:
- Minimal interest
A commission that the borrower (customer) must pay for the loan that the bank grants is the interest on bank loans. Interest rates are set differently by each bank. Therefore, you must be careful when selecting a bank so that the interest on the loan does not negatively impact your company’s financial status. - The bank refrains from meddling in the borrower’s business.
The bank will not meddle in the borrower’s business even though it is an investment in the loan proceeds. You are free to distribute the loan’s principle in accordance with your company plan. The bank only promises that you, the debtor, will adhere to the rules of this credit partnership. The return of funds is one of them.
The bank will also be accountable for performing its obligation to maintain the debt security or collateral. A valuable asset is required as collateral for several bank loan products. It serves as a guarantee that the loan money will be repaid.
- Banks provide a variety of loans.
The range of credit options offered by private investors in the form of banks is another benefit. The loan can be customised to fit your business strategy. from microcredits to capital credits for large businesses. Every bank loan package comes with a unique set of benefits.
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