We all know that to run a business smoothly, we need to have an entrepreneur mentality. An entrepreneur is not only ready to welcome the good things, but also the challenging things that can arise unexpectedly. In times of a pandemic like this, for example, not a few business actors whose financial conditions are in uncertainty. To stay afloat, business actors may have to make decisions that are outside their comfort zone, such as applying for a business capital loan.

 

Basically, a business capital loan is not only something you can apply for when facing crisis times. You see, there are various factors that are the reason why you need additional capital, for example when you want to open a new business branch or make product innovations at your place of business. Well, maybe some of us are still confused, whether applying for a business capital loan is the right decision or not. Of course, the answer depends on each one of us. Therefore, before you apply for a loan, first understand the following things!

 

1. Separate your business funds from personal funds

When you get funding for business capital, separate these funds from personal funds. This may seem simple. However, this action is effective in helping you allocate business funds wisely and appropriately. In addition, separating personal and business needs will also make it easier for you to monitor the expenses you make.

 

2. Pay off funding on time

Not everyone can have the opportunity to get funding. Therefore, you need to be wise so that your credit score is maintained. Don’t let your current indiscipline harm you in the future when you want to apply for funding again. If possible, use the automatic payment feature to ensure you can make your installments on time.

 

3. Minimize expenses and manage your budget

Even though you already get funding, it doesn’t mean you can increase your expenses. Instead, you have to be smart about managing your finances by reducing unnecessary expenses while at the same time managing the budget you have. Remember, there are times when things don’t go according to plan so you too will need an emergency fund.

 

4. Make financial records

As a business actor, you need to manage cash flow in your business so you can find out how much expenses and income you get. Every time you pay an installment, record it as an expense to make it easier for you to measure your financial flow. This step is also important to know how much progress you have made and whether there are other things you should improve. Through the Premium POS Cashlez feature, you can also see a summary of the cash flow at your place of business!

 

5. Use profit as capital

When you get funding for business capital, you need to manage finances like a staff who is paid by employees. So, you have to allocate profits for business capital needs and repayment of installments first. When your installment is complete, then you can use the operating profit for other purposes.

 

Business capital loans are one type of productive loan. That is, you as a borrower are expected to be able to do things that are beneficial for your business. So, make sure you use loan funds wisely, okay? By the way, Cashlez is also working with KoinWorks to make it easier for Cashlez partners to get additional funding safely and practically. Let’s find out more here!

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