Are you dreaming of further developing your company, investing in new products and markets or maybe setting up a second branch? As professional financial advisors, we know that it is not easy for SMEs and especially for start-ups to obtain SME financing from traditional credit banks. Many entrepreneurs are therefore interested in corporate financing without a bank – we will show you the possibilities in Switzerland.
Corporate finance through banks: Often difficult
The idea is good, the business plan has been made and the necessary preparations have been made, but the bank refuses the required corporate loan – this is how hundreds of entrepreneurs in Switzerland are doing. Smaller companies, sole proprietorships and start-ups in particular often find it difficult to obtain an attractive financing offer from their main bank. But even if your own company generates profits, the loan terms are often disappointing: too low sums, too high interest rates are offered. Many company managers are dissatisfied with financing from the banking sector and are therefore looking for alternatives . What do they look like? We would like to introduce two interesting ways to finance your company without a bank:
- Factoring (pre-financing of proceeds)
- Crowd lending
What is factoring and is it bank-independent?
Factoring (you can find an offer here) is a form of corporate finance that does not require banks 100%. Instead of a bank, a factor becomes your financial partner. How does this support your company? The core principle of factoring consists of ongoing pre-financing of your accounts receivable:
- You send your customer an invoice for goods or services. The factor receives a copy of it.
- The factor transfers 90% of the invoice amount to you within 1-2 days for a factoring fee.
- Your customer then pays his invoice to the factor (changed reference number on invoice).
- The factor transfers the open 10% of the invoice upon receipt of the customer’s payment.
With this form of corporate financing without a bank, you get liquidity faster and benefit from cash discounts and discounts from suppliers. This increases your equity in the long term, which can be used to invest in new products, markets and locations. Attention: factoring is only suitable for companies that mainly do business with other companies (B2B)!
Crowdlending as an alternative to bank loans
Factoring is a very attractive way to finance a company without a bank, but it is not a form of quick capital raising. Do you need funds in the form of a loan as soon as possible? Crowdlending (an offer can be found here) is a form of debt financing in which the lenders are not a bank but a group of individuals and / or companies. There are many advantages to a bank loan:
- There is no need to open a new bank account and the relationship with your house bank remains.
- The decision-making process is shorter and the process is less complicated than with a bank loan.
- Interest rates and loan amounts offered are often more attractive than in banking.
- The crowdlending market is growing rapidly – an indication of increasing popularity and security.
Consult a consultant for corporate financing without a bank
As you can see, there are attractive alternatives to conventional corporate financing through a bank in Switzerland. However, this means that you cannot rely on a banking partner who is there to advise you. We therefore recommend that you engage a specialized financial agent such as Astro Finance who can offer you non-binding and neutral advice. Such a broker also has contacts to various partners in the financial world and will be happy to provide you with the right specialist for your needs: whether factoring, crowdfunding or any other corporate financing without a bank.