14 Mar Benefits of generating credit history for your company
In different articles we have explained the benefits of having a good personal credit history, now it’s time to explain how to start generating a good track record for your company to get more benefits.
Start generating credit history for your SME and get the following benefits.
# 1 Get more loans for SMEs
According to the results of the SME Credit Report that we made, 8 out of 10 entrepreneurs finance their businesses with personal credit or credit cards. This is because entrepreneurs do not have the requirements that financial institutions request and do not have a credit history of their company.
Keeping your business history healthy will make it easier for you to obtain productive loans, so they will be an instrument of growth and not a debt instrument.
# 2 Access to larger amounts and comfortable terms
As with your personal credit history, if you have a good track record with your business you can achieve larger amounts and longer terms. For example, if you apply for a credit as a legal entity in Konfío, you can reach amounts up to 1 million pesos.
Remember that the term is calculated based on the amount you choose, so you can get long-term credits and turn them into an ally of your company.
# 3 Get better interest rates
By continuing to finance your business with credit cards you are paying annual interest up to 70%. If you improve the credit history of your company and you get credits for business you will be saving considerably on the interest you pay. A business loan is much cheaper than a personal loan, since the financial risk is lower.
If you do not know the credit history of your business you can consult it for free once a year in the Credit Bureau. If you are a Physical Person with Business Activity you just have to fill out the application for “Special Credit Report of Companies and Physical Persons with Business Activity” and they will send you the information by fax, mail or courier. In case of being registered as a Moral Person, the report must be authorized by the legal representative.
An SME loan can be a tool that drives the growth of your business, so it’s time to improve your business credit history and obtain better conditions.