Comparison bank loan - Crowdlending in the SME loan

Person who wrote the post admin Jan 07, 2020
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What are the advantages and disadvantages of crowdlending compared to an SME bank loan? In our last blog of the five-part series, we will show you the most important advantages of each type of financing.
Bank loans were and still are the most important source of finance for SMEs (you can find figures here). In recent years, however, alternative forms of financing, such as crowdlending, have become more and more established. Although they still have a niche existence in Switzerland compared to conventional bank loans (see our blog), they still offer some advantages.

The advantages of crowdlending primarily lie in the speed and simplicity of the application process and the financing. We see the following advantages in alternative financing:
• Digital application process and loan processing
• Less administrative effort
• Smaller amounts than possible at many banks
• Greater flexibility in financing solutions
• Loan decision usually within 48h

For bank loans, the most important criteria are primarily the very good financing options and the handling of complicated transactions.
• Larger amounts of creditworthiness easily available
• Existing relationship with the house bank / customer advisor
• Established companies with a strong balance sheet
• With larger transactions, more complex structuring of the deal is possible

As a matter of principle, it is still necessary to check whether a bank loan or an alternative financing makes sense for an SME loan. A loan via Crowdlending is particularly useful for smaller amounts, since financing tends to be easier and less complicated to carry out.