Record profits in 2017
On 26 March 2018, the Central Bureau of Statistics (CBS) published an article about record profits at non-financial companies. The gross profit before tax in this branch was more than 217 billion euros. It was the highest profit ever since the measurements started in 1995. Petrochemical companies in particular are doing very well. An important element for profit growth is the strong position of the euro. Many companies have a business loan in a currency other than the euro. Because the dollar and the British pound have become less valuable, business credit costs less money. Low interest rates also play a role. Companies can borrow money at lower costs.
Apply for business credit online
Many SMEs applying for business credit have moved to new lenders on the internet. An initiative in this area is lender New10 which was launched in September 2017. The startup is owned by ABN AMRO and works in a completely different way than traditional banks. It is possible to have an answer to the question whether a loan is possible within 15 minutes. The application and handling are completely online. The applicant uploads the required data (such as the annual figures) and the system automatically evaluates the application. The minimum credit with New10 is 20,000 euros. If you were to apply for a business loan online at Rabobank, you would have to wait a week for a personal interview. The options are then discussed and the best financing is examined.
SME financing with an ordinary bank
What about the business credit to Dutch SMEs? Statistics Netherlands has no recent figures. According to an article in Follow The Money, ordinary banks are bored with SMEs. Too little money is earned from it. The banks place high demands on small and medium-sized businesses, which has greatly reduced the chances of a credit. Banks prefer to do business with export-oriented companies than with family businesses or startups. Rabobank is an important provider of SME credit in the Netherlands. The money often comes from the Bank, which supports the business community in Europe. The average loan from the Bank is 900,000 euros. In the meantime, Rabobank has placed a large part of its SME loan with the Bank.
The economy is growing rapidly again and the business community needs financing. The banks, however, are cautious about providing loans to small and medium-sized businesses. Alternative solutions that are increasingly being used are alternative credits that are stacked. Rabobank has given an example of this on its website. A young company that packs packages for web shops wanted to apply for a business credit for a large machine. The bank then spread the risk. Not only was a bank loan provided, but the company could also use leasing, factoring, a state guarantee and a loan from the Bank. The company was helped with a good business loan. The duration of the loan could be extended by the state guarantee. This allowed the company to borrow at a low interest rate.
Borrow money from your BV
Do you want to limit the influence of third parties on your business operations as much as possible? Then borrowing money from your own BV can be a great solution. On the website of the tax authorities you can read the conditions that such a business credit must meet. For example, the BV must be able to continue to meet its obligations and not get into trouble with this credit. An interest payment must also be agreed that is in line with the market. It cannot go for a friend’s price. Finally, the loan must be recorded in writing with clear agreements about repayment, interest and the securities that can be offered.