Business Financing Ohio Small
The public sector financing programs can be useful tools for businesses to get finance for starting their business or to expand it. There are a number of small business financing programs made available by the local, state and federal sources in the State of Ohio. The small business financing programs in Ohio are basically of two types:
• Direct loans
• Loan guaranty programs
The direct loans would usually finance only a part of the total financing that is needed to meet the fixed asset needs. Most of direct loan programs provided by the public sector are gap financing. The gap financing would fill the gap between the total cost of the project and the amount of fund that the borrower has taken from other sources like personal savings or loans from private banks. Some of the examples for gap financing program are Community Development Block Grants and the Revolving Loan Funds. These programs are needed to meet certain requirements like creating new jobs and should provide benefits to people with low and moderate income.
Small business entrepreneurs can also consider loan guaranty programs. The loan guaranty program protects the lender like a bank or any other financial institutions from default in case the business owner is unable to pay back the loan. The most common type of loan is the SBA 7(a). This program guarantees up to 90% of the loan in case of default. The loan guaranty program can be accessed through most of the financial lending institutions. These financing programs are made available to the borrower in case of denial of conventional financing.
There are a number of small businesses that are very small in structure. Such businesses are called as micro enterprises. They can get business financing loans in the form of the SBAs Micro Loan Program and the Child Day Care Direct Loan. These programs would have reduced paperwork and have flexible terms in comparison to other loan programs. The loans have more flexibility in terms of equity and collateral requirements. The loans can be used for financing the working capital, finance for inventories, supplies etc. This type of assistance is however not available through public programs.
Small businesses that take the help of public sector financing are required to be careful about the loan approval process and the credit analysis. The loan process is similar to the other financing programs that are used by private banks and financial institutions. Small businesses will be required to provide personal as well as business financial statements that would prove the loan repayment ability of the borrower. In case of new businesses the borrower apart from providing personal financial statements is also required to provide a business plan.
Some of the sources of finances for small businesses are mentioned below:
Small Business Development Centers (SBDCs): the Small Business Development Center provides confidential and extensive help to small businesses without any cost. These assistances can he taken by businesses that function in the field of planning, management, finance, and start-up. The SBDC programs in Ohio are a part of the Small Business Administration programs that function in collaboration with the Ohio Department of Development (ODOD). The Small Business Development Center is responsible for taking care of the small businesses and there are a number of small business financing programs that function under this center.
Women's Business Resource Program (WBRP): these programs function under SBDC programs. The WBRP helps small business ventures started by women by providing them training, counseling and financial assistance in Ohio. The WBRP provides networking facility among the small businesses that are run by women in Ohio by taking out newsletters about the calendar of events, maintaining a clearinghouse of women business organizations, conducting workshops etc throughout the state of Ohio. These programs provide a lot of help to women who are either expanding their business or planning to start a business. Apart from financial assistance they get first hand information about how to handle businesses.
One-Stop Business Permit Center: this also functions under the SBDC network. The Permit Center provides information on the permits and the license that are needed to start a business or facilitate its expansion in the State of Ohio. These informational kits are created to address the start up or expansion requirements by the specific type of business. Each type of business that functions in a different sector would require different types of licenses and permits. This Permit Center educates the business entrepreneurs on these permits and licenses that are required for their business.
Procurement Technical Assistance Program: this assistance program is also called as Procurement Outreach Centers (POC). This program provides counseling and assistance to businesses that are interested in taking up federal projects and contracts. All the help and assistance is provided free of cost. These programs also function in association with the Small Business Development Center. You can easily contact this center either through phone or through e-mail.
Ohio State University Small Business Program: these assistances are provided through the Ohio State University Extension Network. The small business, financing program under this program would offer counseling to entrepreneurs and conduct seminars, workshops, and provide the required assistance to the small business ventures. This program is of much help to the small business enterprises as they can be educated on the type of assistance that they would require for the business venture.
There are a number of small business financing programs in Ohio that are readily made available to small business enterprises. If you wish to start a small business then you can get in touch with any of the centers that have mentioned and get the requires assistance.
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