Broker versus Bank - Which one is right for you?
Posted on 13th July 2022 at 21:46
You have started out in your new business and are now looking for funding. Most start-ups and first-time business owners go directly to traditional lenders, i.e., banks and other financial institutions. But, are they really the best option for your business?
So, what is the difference between a broker and a bank?
There is no question that banking and lending have changed, not just over the last decade, but more drastically in the last five years. These changes have left business owners with fewer choices when it comes to financing their businesses.
Back in the day, banks offered a more personal touch. You could speak to a bank manager or consultant to assist you in the process and advise what would be the right choice for your business. Unfortunately, things have changed. Banks have transitioned into more system-generated offerings, with red tape blockers that the consultants cannot modify or take your individual circumstances into consideration. Whereas, brokers have a more one on one personal approach, finding out more about you and your business and are driven by building relationships with their clients. The benefit of this is that you, as a business owner, know that they are working hard to find you the best funding option out there.
If you're looking to plan your financial future, it's important to know the difference between a broker and a banker.
- A broker makes multiple connections with funders/lenders, which enables them to source and negotiate a wider field of finance options to choose from. Banks are tied in with offering you the products they have listed and these may not be suitable or tailored to suit your needs.
-The application process of applying for a loan can be tedious, taking up valuable time and effort. Brokers take this element of the application process away by preparing and obtaining the documentation needed ready for submission. Making your application experience simple.
A key priority as a broker is to develop a trusting relationship with your clients and funders. By doing this, they can provide the service and options that work for you and your business. Brokers shop around to find you the best rates possible, whilst with banks, their rates are set, generally non-negotiable and all application requirements are handled by yourself.
It's important that you find someone who you trust and who understands your financial situation so that they can help guide you in making smart decisions about money matters in general!
At Lending Made Simple, we pride ourselves in taking each individual case into consideration so we can source and tailor-make the funding option suitable for your business.
If you would like to find out more or chat about what options are available for your business, give us a call on 01892 280000 or email Gillian Palmer at firstname.lastname@example.org - We are more than happy to have a chat and answer any questions you may have.
Tagged as: bankers, banking, brokers, cashflow, cashflow management, funding, lending, lending choices, smes, smeuk
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