At present, it is not enough to be creative and have a good idea so that the success of our business is guaranteed. In addition, other factors are needed, such as choosing the right time and place, but above all having sufficient funding to carry it out. And that’s where the problems begin to arise. There are many forms of financing for people, it is easy to obtain a quick loan or a credit, on a personal level, but the alternatives are reduced when it comes to finding financing for companies. It is the most common option, and it is what is called B2C, or business-to-customers . That is why new organizations are entering the scene, which are specializing in this sector, trying to cover a space in which financing to develop is vitally important. A clear example is the firm Konfío, which presents itself as the best ally of Mexican SMEs, presenting accessible and agile access credits, so that companies can grow and increase their capital. According to a study by Medici, experts in fintech, B2B lenders are growing in popularity exponentially, being the second most popular financing option, only behind traditional lenders. But are financing options adapting to current needs?
What is B2B?
Before going into B2B loans in detail, it may be interesting to briefly explain what that term refers to. It comes from English, and is the acronym for business-to-business, referring to business-to-business transactions, that is, companies that dedicate their activity to selling to other companies. This is the case of companies that, in order to access their products, require registration and identification that proves that you are a legal or professional person under another regime.
Traditional banks VS B2B lenders
There are two main ways of financing B2B, to which, most SMEs should go at some time in their lives. On the one hand, there are the traditional banking entities and on the other, organizations such as Konfío, which have been able to adapt to the needs of many companies, and use new technologies to improve the customer experience. Let’s analyze these characteristics a little more in detail:
- Credit granting time . This differentiation is essential in situations where financing is urgently needed. While traditional banking may need to approve a loan between 2 and 4 weeks, companies like Konfío get a response to your request in just 10 minutes. Thanks to state-of-the-art technologies, and software developed specifically for this, they reduce validation times and risk analysis to a minimum. If you need fast money to make a payment, the speed of these companies is definitely a point in your favor.
- Availability Conventional offices, as their own name suggests, are subject to real spaces and with physical locations, and therefore, they are determining a place where such credit has to be requested, and schedules in which the company itself can provide care to the client. Instead, modern companies, using the internet, can offer the service anywhere you have a network connection, and your Smartphone or computer. In addition to avoiding travel and possible queues, they offer their automated service 24 hours a day, so it will also be possible for you to apply for the credit at the time that is most convenient for you, without having to be determined by the office hours , and having to leave your own work for it in case the schedules coincide.
- Guarantees of payment . It is well known by all, that this procedure is one of the most complex to overcome with conventional entities. It is common for banks to require us to present guarantees and guarantees for the granting of the loan, and this in addition to making the process slower can put us in a compromised situation if the investment does not go in the right way we want. On the other hand, we have modern companies that know about this situation, can offer loans without guarantees or guarantees, making this alternative much more attractive.
- Deposit of the amount . This difference is perhaps the least significant between both options, although the balance is also tilted on the side of the most modern options. Although, traditional banks obviously only allow the refund in the accounts of the same bank, these new companies allow multiple options, which can be helpful to avoid higher fees for payments, transfers, maintenance, etc.
- Required documentation It is another of the main differences between these different markets. Traditional banking requires a multitude of paperwork, documents, certificates, etc. which makes the process slower and tedious. While the new lenders, through technology offer practical solutions based on technological advances, minimizing the necessary documents.
Advantages of B2B lenders over banks
In principle, conventional banks have the confidence and support of having been the main option for many years, which makes it a product already known to potential customers. However, other options are changing the landscape, and then we will describe some features that we consider advantageous for B2B lenders:
- Opportunity for loans for lower amounts . For many banks to agree to offer financing to other companies, huge amounts are required, which are sometimes higher than hundreds of thousands of dollars. The new B2B lenders understand that there may be a need for lower amounts, and that is why they include in their offers low amounts, from about $ 1000, which undoubtedly favor their use for more ordinary expenses.
- Suitable for start-ups. This type of company is growing in popularity in recent years. And as a new form of business, it has different characteristics and different needs to the traditional ones. Therefore, the very restrictive criteria that banks use for companies are an impediment to Start-ups. Therefore, the flexibility offered by new lenders can be of vital help to these types of companies of the 21st century.
- Valid for lower scores . In general, traditional banks have very strict risk validation systems, so if your score is not excellent, it will be very difficult to obtain credit. This is one of the aspects that the new B2B lenders were willing to improve, and they achieve this by increasing trust on the client, although this entails increasing the risks. In this way, access to such financing is easier.
- Financing much faster . Being fully integrated to the new times, the resources used are up to par, and the greatest customer satisfaction is one of the priorities. As one of the main aspects to improve were waiting times, with the help of powerful software they have managed to reduce these times to a minimum.