Credit bureau for non-institutional loans
Our software Kiipr: the benchmark among complementary solutions to traditional credit bureaus
Advantage 1: Reduction in Financing Costs
A primary reason SMEs opt for self-managing loans is the reduction in costs associated with borrowing from traditional financial institutions. Interest rates on commercial loans can be high, leading to significant monthly outlays for SMEs. By managing the loans they provide to their customers themselves, SMEs can save on financing fees, thus boosting profitability.
Advantage 2: Flexibility in Loan Terms
SMEs often have unique financing needs that don’t always align with the standard terms of traditional financial institutions. By managing their own loans, SMEs can tailor loan conditions to better cater to their customers' needs. This might include flexible payment terms, competitive interest rates, and other benefits that can draw in more customers.
Advantage 3: Strengthening Customer Relationships
When an SME offers financing options directly to its customers, it deepens its relationship with them. Customers value the flexibility provided by payment options and are more likely to remain loyal to the company. This can result in repeat sales and positive referrals, contributing to business growth.
Advantage 4: Reducing Dependence on Financial Institutions
Over Reliance on financial institutions can make an SME vulnerable to financial market fluctuations. By managing loans internally, SMEs decrease their dependence on these institutions, making them more resilient to economic ups and downs.
In a scenario where SMEs face mounting financial pressures, self-managing loans for sold goods and services emerge as a key strategy to maintain profitability. By reducing financing costs, offering more flexibility to customers, strengthening customer relationships, and reducing reliance on financial institutions, SMEs can overcome challenges and thrive in a competitive business environment.