When your SME needs money, your first port of call is likely to be the bank. Bank loans are very convenient and tend to have lower interest rates, so they are the ideal source of capital for the average business, but what do you do when the bank isn’t keen to give you a loan? Here are some very effective alternative ways of funding your SME when the bank loan is a no-go:

Credit Cards

If you can’t get a bank loan, you may still be able to get a business credit card, and if that isn’t possible, using your own credit card to fund those important aspects of your business is always a possibility. However, you shouldn’t spend more than you can realistically afford to pay back and ideally, credit cards should be primarily used to plug short-term gaps in your finances, such as those times when you’re waiting for a client to pay up, so that you do not accrue large amounts of interest.

Online Lenders

Online lenders are springing up all the time, and they are becoming a very popular alternative to the bank loans we’re all so familiar with. Using online loans, you can get cash advances and longer-term loans at the click of a button, and a lot of the time, your application will be approved in seconds, with the money entering your account soon after. This is, then a great option for business who need money in a hurry, but you should be aware that interest rates are typically far higher than you’d get at the bank.

Angel Investors

Angel Investors are great for small businesses looking for an injection of cash in the early stages of setting up business. These investors will give you the cash you need to turn your business ideas into a reality in exchange for a small return, usually around 25 percent on their investment. Many big businesses, including Google, have used Angel Investors in the past, so it is a solid option if you have a good idea and you just need the cash to get it off the ground and you don’t mind some of your profits being diverted to your Angel Investor.

Venture Capitalists

Venture capitalists again deal primarily with start-ups rather than established businesses, but if you are in the process of launching a business that is deemed to be high-risk, but if it works out could have a high-growth potential, they are the people you want to speak to. Of course, in order to secure their investments, you will need to have a great idea, a brilliant pitch, and most importantly, a solid business plan. If you don’t have any of these things, then securing the support of a venture capitalist could be difficult, to say the least.

Factoring Advances

Factoring or invoice advances, as they are also known, are available to established businesses who just need a cash advance on bills that have been invoiced to clients, but not paid yet. They are used to keep the company going while they wait for bills to be paid, which you will probably know, can sometimes take a while, and are an excellent option for SMEs that just need to remain solvent in the short term.


Crowdfunding websites like Indiegogo and Kickstarter can really give small businesses a boost by allowing members of the general public to pool together and raise money for a business/product/service that they like, and which they want to back. If you need to raise money to create something that you know will appeal to the kinds of people who use these sites, creating a pitch could be a good way to raise money risk-free.

Business Grants

Wherever you are based, it is highly likely that there will be various government grants available to SME enterprises to help them get started, grow and develop new products. You just need to put the effort into finding them and doing what is necessary to meet the criteria for eligibility. Obviously, there is no guarantee that you will ever be awarded a grant, so you shouldn’t rely on them as a means of funding your business, but you should certainly make an effort to apply if you can. If you aren’t offered a bank loan, there really is no need to despair. There are, as you can see, so many funding alternatives about there, with more cropping up all the time, which there are always options available to you if you take the time to look.