Who Offers Secured Small Business Credit Cards

Nov 21

Secured small business cards are offered by different establishments, including small and major banks, and other entities. They are available to business owners with tarnished and less than perfect scores and help boost ratings. The user’s savings account serves as a guarantee or collateral.

Establishments That Offer Secured Business Cards

There are small business cards by AMEX, Visa, MasterCard, and other issuers. They are usually offered by major and small banks, including BMO, CIBC, RBC, Toronto-Dominion, and others. Mortgage providers also offer secured cards to small businesses. Some banks offer cards to new businesses with a limited credit history. They usually come with annual fees but the funds deposited sometimes earn interest. The downside is that holders pay more in interest charges on cash advances and purchases. Some issuers also charge one-time fees. In general, these cards are intended to fill gaps in cash flows when they occur rather than make big-ticket purchases to start a business. Many issuers offer solutions with low limits of $200 to $500 while others feature larger limits of $1,000 to $25,000. While banks charge annual fees, some offer annual fee waivers during the first year. Additional cards may be available so that business owners control employee spending. Some banks offer between 3 and 10 additional cards (https://www.lifeoncredit.ca/top-5-student-credit-cards-for-young-canadians/). In addition, some secured cards come with beneficial features such as cash back and rewards that can be redeemed for brand name merchandise, travel rewards, gift cards, and account credits. Business owners are free to choose from different categories such as healthcare, travel, gas, utilities, office supplies, and many others. Credit unions also feature secured cards with beneficial features such as no cash advance fees and no annual fees, long grace periods of 25 days, and attractive interest rates. Another benefit is that unions offer high interest limits of $20,000 – $25,000 depending on the deposit made. In addition, unions also run their own rewards programs and advertise cards with merchandise, travel, and other rewards. Other cards (https://www.lifeoncredit.ca/top-6-credit-cards-for-bad-credit-in-canada/) have a limit of about $1,000 to use for everyday stationary, gas, and other purchases.

Benefits for Cardholders

In addition to convenient and flexible access to funding, business owners are offered a number of perks such as customized cards, business bill pay solutions, overdraft protection, cashback rebates, and others. Further add-ons and benefits include travel insurance and assistance, purchase protection, auto rental collision insurance, competitive interest rates, and others. Issuers also advertise introductory offers to attract customers.


Credit accounts are also offered by gas stations and office supply stores, and the approval criteria are less stringent compared to brick-and-mortar financial institutions. The interest rates are often higher, and it is a good idea to pay the balance in full. A secured loan by your credit union or local bank is also an option provided that you have some asset to pledge as collateral.


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How to Open a Frozen Yogurt Store

May 20

There are several steps to opening a frozen yogurt store, and the first is to choose company structure that suits your business. The next steps are to apply for licenses and permits, find low-cost sources of financing, develop a business plan, and purchase equipment for your yogurt store.
Factors to Take into Account
To begin with, it pays to research your niche and customers. You can check employment, income, age, and other statistics and interview customers in the area to find out what they think about your project. You can also ask about their tastes and preferences. Obviously, it is important to know your competitors and what they have on offer. The next step is to obtain the required permits that allow you to serve food and drinks. If you plan on opening a frozen yogurt store, you will probably need building, zoning, and health permits. You may want to talk to an accountant to find more about tax rules as well.
Business Plan
It is important to have a business plan if you are applying for a business loan. You may want to include executive summary that contains marital status and age demographics data as well as educational background, income level, disposable income, and market segmentation information. Your business plan must contain a market segmentation strategy, market analysis, buying patterns and competition, and industry analysis. Describe competitors in your area and include milestones and implementation summary. Include your sales forecast and sales strategy as well as your personnel plan and management strategy.
Private and Government-Sponsored Financing
There are different options to finance your business, including cash from other investments, funding under government programs, and business loans offered by credit unions, banks, finance companies, and peer to peer lenders (https://www.lifeoncredit.ca/the-most-popular-bad-credit-lenders-in-ontario/): list courtesy of Life on credit in Canada  Banks offer two types of business loans, secured and unsecured and business lines of credit. Secured credit cards (https://www.lifeoncredit.ca/top-6-secured-credit-cards-for-canadians/) and loans and have more attractive repayment schedules and rates but financial institutions require collateral. This can be machinery and equipment, vehicles, deposits or cash savings, accounts receivable, business inventory, real property, and other assets of value. Unsecured loans are also available but the repayment term is usually shorter, and the interest charges are higher. Funding is also available in the form of Canada Small Business Financing loans, and businesses are offered up to $500,000 to purchase real property such as premises and land. There is an option to apply for a loan of up to $350,000 to purchase machinery and equipment or to make lease improvements. Companies are asked to submit a business plan along with their application. The loan term varies from 7 to 10 years and is based on the amount requested (the asset financed). In general, financing is offered for renovations, equipment installation, purchases, and modernization.
Other options are to apply for a loan through a peer to peer lending network or to contact angel investors or venture capitalists. Look for grants under government programs as well. According to expert estimates, opening a frozen yogurt store costs between $10,000 and $50,000. However, you should factor in expenses such as salaries, utilities, inventory, rent, maintenance, and so on. You will need at least $10,000 to cover upfront costs and free up cash to run your store on a daily basis.

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Financing Options and Licensing Requirements to Open a Small Shop

Mar 13

Financing Options and Licensing Requirements to Open a Small Shop

If you want to open a small shop such as a small convenience store, coffee shop, frozen yogurt shop, or flower shop in Canada, one option to finance your investment is to apply for a small business loan. You can use the money to rent property or finance equipment purchases. Business owners are offered private loans by financial institutions and government loans under the Canada Small Business Financing Program.
Government-Sponsored Loans
Under government sponsored programs, business owners are offered loans to finance up to 90 percent of the purchase to start a small business. There is also a limit on the annual gross revenues ($5 million). Applicants are asked to submit a business plan together with their application. If you plan to open a coffee shop, for example, outline your objectives and mission and include information such as company ownership, executive summary, and total assets and start-up expenses. List required equipment and start-up inventory such as coffee grinders and coffee makers, counter area equipment, and service equipment, including blenders, dishwashers, toasters, microwaves, and so on. It is a good idea to list start-up equipment such as office and retail supplies, for example, coffee bags, napkins, filters, coffee beans, and so on. Detail your store and serving area equipment such as ventilation, security, cash register, flatware, glasses, and plates. Finally, list start-up requirements and expenses, including rent, insurance, consultants, brochures, stationary, and legal fees. The next step is to apply for a small business loan. The terms vary from 7 to 10 years based on the types of assets to be financed. You can choose between fixed and variable rates. Borrowers are asked to provide collateral up to 25 percent of the loan amount. They also pay a registration fee up front (2 percent of the amount requested). There is also an annual administration fee. Business loan insurance options are available.
Private Loans
Again, it is a good idea to develop a business plan and include details such as estimated profit and costs, business structure, management details, etc. The next step is to visit your local bank, especially if you are an existing customer, and ask about different financing options. If you have personal or business assets such as business equipment, buildings, or vehicles, you can use these assets to guarantee loan repayment. Banks are willing to offer lower interest rates when you pledge a valuable asset as collateral. You can tap on your home equity as well but this is a last resort because you risk losing the asset used as collateral.
The licensing requirements vary depending on the type of establishment, i.e. whether it is a cafeteria, coffee shop, brasserie, bistro, pub, or specialty food restaurant. Other options are food tracks and fast-food restaurants and casual dining and gourmet restaurants. To begin with, inquire about the regulations and licenses that apply to your coffee shop or flower shop in your province or territory of residence. The next step is to choose a business structure for your company and type of business. Incorporate or register your business and ask if you are required to remit and collect harmonized sales tax. Note that you may also need permits and licenses from the municipal, provincial, and federal authorities.



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