Small business owners have money on their minds.
A new survey by New Jersey-based TD Bank (NYSE:TD) reveals 21 percent of small businesses have sought or will seek a loan or line of credit. Most of them (72 percent) will approach their primary bank.
Other Findings from the 2017 TD Bank Small Business Month Survey
Small Businesses Feeling Optimistic
The study also shows small business owners are upbeat about their growth prospects.
About 46 percent expect to increase revenue or sales in the next year. A majority of them (80 percent) feel confident managing their business finances.
But Challenges Persist
A segment of small business owners (11 percent) however admit they don’t know how to seek credit when they’re ready.
For 34 percent of them, their low personal credit score has affected their ability to get business credit in the past. Worse still, 69 percent of entrepreneurs don’t even know about business credit scores or realize they have one.
It Pays to Gain Financial Knowledge
Whether you are planning to expand your business or fulfill more orders, you may find yourself in need of funds.
Before approaching a bank, it’s best to be prepared and have all the information at your fingertips. For example, it’s extremely important for you to be aware of your business credit score. A business credit score reflects your company’s creditworthiness. So apart from impacting your ability to get approvals for loans, it influences commercial partners when they determine extensions of lines of credit.
If you find out your credit score is negative, there are ways to fix it, too. You may, for instance, limit your credit usage and learn more about soft credit inquiries. These are simple steps that can make it easier for you to fix a negative credit score and secure capital.
TD Bank surveyed 553 small business owners with less than $1 million in annual revenue for this study. Take a look at the infographic below for more information:
Image: TD Bank
Loans are not all that bad especially if it helps the business grow. In fact, it can even empower a businesses to grow bigger in a smaller span of time.
I think that this system is here to stay. Small businesses need all the help that they can.
It seems that more and more business owners are getting more comfortable with loans. It is good for the industry for it powers it.
It’s scary that 69% of small biz owners don’t know their business credit score. Just like personal credit, improving that score makes it easier to qualify for business loans that are actually affordable.