Know about the Finance and Investments Terms

Suppose you are in need of an urgent funding to take your business to the next level. When approached for the business loan, the bank or lending institution may ask you to pledge an asset, or contrarily, offer the funds minus any collateral or guarantee. The former   arrangement is called secured business loan while the latter is known as unsecured business loan. Let’s get into the pros and cons of the two for an in-depth understanding. 

Advantages of Secured business loan: 

• A secured business loans guarantees larger funds, depending on the pledged asset. Usually, about 75% of the asset’s value can be availed as a loan. 

• Since the risk of a default is covered by the collateral, the lenders can provide competitive interest rates. 

• The repayment schedule may stretch beyond 5 years, ensuring stress free repayments. 

• Secured loans may be the only option available for people with poor credit score. 

Disadvantages of Secured business loan: 

• In case of non-repayments, you may lose the pledged

Do you own a company in Bangalore? There is a limitless scope to grow and flourish your business in this city due to various reasons. Bangalore is known for its innovating technology, strong economic base and infrastructure development that provide a right platform for companies to grow easily. All you need is sustainable planning and investment. If you have the best plans, then look for the financial support or small business loan to ensure the right growth and development of the company. Business loan in Bangalore is common and companies whether small or big find it the best way to raise capital and grab the growth opportunities.

A small business loan is now considered as the versatile financial product that is highly beneficial for companies at the time they fall short of capital. Such loans are flexible and can be easily availed without much documentation and time. Before you avail the business loan in Bangalore finds the right answers to questions like –

• How much loan do you

There are two concepts of working capital – gross working capital and net working capital. Since companies must have adequate working capital to run and grow their operational functions, they must understand the nature of these different types of working capitals.

Gross Working Capital

Gross working capital is a company’s total amount of current assets, including cash on hand, inventory, accounts receivable and short-term investments. However, liabilities are not part of this calculation; hence gross working capital shows a limited description of a company’s finance. 

Gross Working Capital = Total Current Assets

Net Working Capital

A net working capital is a complete and accurate measure of a company’s liquidity health.  It represents a company’s excess of current assets over its current liabilities. The current assets comprise bank balance, cash, debtors, stock, bills receivables, etc. On the other hand, the current liabilities include things like creditors, bills payables, etc. 

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