Did you know that small and medium-sized companies are primarily responsible for the flow of the economy in the country? According to the latest survey by Sebrae , these organizations are the ones that generate the most jobs in Brazil with a formal contract, accounting for 54% of formal jobs. But what will be the credit scenario for small and medium-sized companies today?

As important as it is to have lines of credit to continue generating new jobs, it is common for these companies to still have difficulty obtaining loans with lower rates.

That is why we have prepared this content to what are the best practices for applying for credit to small and medium-sized companies , talking about the difficulty of proving a payment guarantee to request access to some institutions that do this work. See also the main ways to apply for a loan!

What are the best practices for applying for credit for small and medium-sized businesses?

If your company is looking for credit with the lowest rates and you still don't know what preparations or first steps you need to take to increase your chances of getting it, know that there are some steps considered as good practices that can help make the path easier :

  • Determine a loan amount based on your planned income : make your application no more than 10% to 15% of your annual income. This is taken into account as a way of showing your ability to keep paying and meet your credit obligations;
  • Always keep your credit score positive : Your personal or business credit score is taken into account as one of the loan guaranteeing factors. It must be part of the requirements observed by the companies that will analyze your request. So, know your scores in advance. Usually, a bank or financial institution already blocks lines of credit for those who have a score of 700, which are the minimum requirements;
  • Make it clear what your current cash flow is : with a cash flow presented through your complete financial report, credit institutions are able to make a more complete analysis that can benefit the release of the credit line quickly. Therefore, managing your cash flow well shows the profitability capacity with the financial health of the business and the advantages of receiving a loan.

3 options for applying for credit for small and medium-sized businesses

In the search for credit with the lowest rates, who can companies turn to? We are now going to present the 3 main options at that time to get the loan released and what are the characteristics of each one.

1. Big banks

Traditional, bureaucratic and time-consuming process. This is the scenario encountered when trying to seek credit for small and medium-sized companies in large banks operating in the country.

The traditional process becomes clear when entrepreneurs identify themselves when arriving at one of these institutions. After all, bank managers don't like to receive small companies looking for credit.

And the bureaucratic process, with several obstacles placed during the application process, only makes it clear that these financial institutions bar this line of credit on the grounds that they cannot afford the high risk of smaller operations.

2. Fintechs

Fintechs emerged on the market as a source of credit hope for small and medium-sized companies. The promise of facilitating processes and speeding up the release of credit caught the eye of several entrepreneurs looking for a simpler way to seek these lines of loan.

But in practice, what was seen after a short time is that the process really is faster than traditional banks, but it is still bureaucratic. Another point that has become a complicating factor in most cases is the need to provide some payment guarantee to facilitate credit.  

3. Techfins

A new facilitating process that is growing in Brazil is yet another option for obtaining credit for small and medium-sized companies. Techfin (a technology company that seeks financial solutions for its customers) came precisely to simplify the process of guarantees and credit requests .

According to ABES, from 2017 to 2018 there was an increase of almost 3% in companies using software, that is, companies that acquired systems that help them manage the company, having a complete view of the company's operation. This goes directly with the objective of techfins, which propose modernization for companies that want to boost business.

Through intelligent information and partner financial institutions, techfins provide agility and proactivity in carrying out financial services . Facilitating banking transactions and winning over customers who value practicality is the role of these new companies.

Now that you know the details, how about getting to know a platform specially designed to serve this market, offering external solutions and financial services quickly and simply, in the cloud? Meet Sky.Simple , platform


Written by

Sky.One Team

This content was produced by SkyOne's team of cloud and digital transformation experts.