Politics and Business
How to get a business loan in New York City
A report by New York City Comptroller revealed some very appealing statistics for anyone with a passion for business. In 2017, GDP for the state amounted to $1.5 trillion – enough to trump Canada’s entire GDP were New York a country on its own. What’s more, the economy is expected to grow up to $2.5 trillion by the year 2035. This goes to show that there are many opportunities to be exploited, especially by small businesses.
So it is no wonder a report by Small Business First showed there were over 200,000 businesses operating in New York City. Among them, 98% are classified as small (less than 100 employees) and 89% as very small (less than 20 employees). However, things on the ground don’t always look so rosy, and inasmuch as there may be opportunities, challenges are also common. That is why Excel Capital Management is always available when someone needs a business loan in New York City.
One of the challenges many businesses within the city face is the high rent prices. Rent rates in NYC are among the highest in the country, forcing small businesses to downsize or move. Salaries are high for workers in the state too in order to adequately compensate workers in the expensive cities, and the regulations, taxes, and fines are not a joke. In the midst of all these, entrepreneurs must still survive and even thrive, and what better way to get a leg up than through a business loan. If you’re considering applying for a loan, these are some of the avenues you should be looking at.
There have been several programs set up to help small businesses in New York City by providing funding. These were set up because small businesses in New York city provide employment to more than half of the population in the private sector. Some of these programs include:
NYC Economic Development Corporation (NYCEDC)
Any small business in NYC could be eligible for a loan under the NYC Capital Access Loan Guaranty Program. A small business is classified as that with less than 100 employees, and they might even consider an application for a startup, but your business has to be located in the NYC area. You may receive up to $250,000 in funding through the program, so it’s definitely worth checking out.
These business loans are offered in the form of lines of credit to enable the purchase of equipment, business expenses, expansion, etc. This program provides a guarantee of 40% on the loan amount, leaving the rest to you as determined by the lender – NYCEDC does not directly offer the funding.
SBA loans are the most common across the country, and they are also available in New York City. All you would need to do is to find a lender who offers SBA loans because the Small Business Administration, just like NYCEDC, is not a financier. There are many lenders in the NYC area, many of them probably a stone’s throw away from your business, so it shouldn’t be a problem.
WE Fund Credit
This is a program meant specifically to help women entrepreneurs in NYC. The requirement is that the business must have been in operation for over a year and made $50,000 in annual revenue the previous fiscal year. Qualified applicants may receive up to $100,000 in business loans.
It would be impossible to list all of the programs available for small businesses in NYC, but some of them include:
- The Brooklyn Fund
- Excelsior Growth Fund
- Business Center for New Americans
Nowadays, one does not have to go to the bank to receive a business loan as you would have to just over a decade ago. Many FinTech companies have arisen that also provide funding even through mobile devices. What’s more, these loans are even quicker to apply for and receive than conventional lenders. If interested, feel free to check out these companies online:
An example of such a loan would be a construction business loan.
Merchant Cash Advance
For cash businesses, a quick way of receiving funding can be through a merchant cash advance (MCA). This is where the lender gives you financing and you get to pay every day from the sales made on that day. Repayments are automatically deducted by your credit card processor after every business day and sent to the lender until the entire loan is repaid. MCAs are known to have a high-interest rate, but on the other hand, you can receive the funds within a few days, making it ideal for emergency situations.
We put this option at the end because you must have considered it already. Banks and credit unions could provide your business with funding, either as a term loan or line of credit. Line of credit is always more advisable because you only get to borrow what you need and not pay interest on the money you didn’t even use.