All businesses require some source of loan which can come from a lending institution such as a bank or credit union. If you require a formal loan to get your business off the ground or to keep it moving forward, it is important for you to understand the process and paths to accessing capital.
Most common loans offered by the banks for small businesses are:

*    Working capital lines of credit: To be used for day-to-day operations. These loans are generally short-term, about 90 days, but can go up to several years with regular annual reviews. Interest rates are variable.
*    Credit cards: A revolving credit card can be a good cash management tool.
*    Equipment leasing: Banks require a history of operations before lending money for leasing.
*    Letters of credit: The bank acts as an intermediary, promising to pay the seller if all conditions are met. Important for reducing risk for a business involved in international trade.