Everyone wants to prosper and live a good life. For that, they want to earn a good living. But what if they don’t have enough means for that?
They will need some help, to begin with, because if they think their idea of starting up some means of earning is worth it, they will undoubtedly want some capital for it. So where will they go?
Banks? Chamber of commerce? Any other money lending organization?
But does that happen as you expect? Is it that simple?
You go into a bank, share your idea, put forth your problems, and request a loan. And what do they do?
At first, they will show good behavior, ask about your ideas, means, and needs. Then they will continue with their formality of promising the best they can offer.
But what happens afterward is the real story.
Reckless role of banks in business startups:
When you need resources and go to banks for help, get ready for lots of questions, investigation, and struggle, of course! Since they only care about money and what benefits they will get, a light party will not be their teacup. They drool at bigwigs. Those who can profit them, have credibility, and have assets to invest.
Why do banks or other money lending sources say no to startup loans?
It is often quite challenging for a startup business to acquire a loan from a lender or commercial bank. New businesses are the riskiest loans that a bank or lender might encounter. So, they think a million times about startup loans.
Let’s understand why business startups are risky.
Lenders expect the borrower to have the following 4 C’s of Credit (character, collateral, capacity, capital):
- Character: A good credit rating (personal credit or business credit) will not get you a loan for sure, but a poor rating will probably get you turned down quickly.
- Collateral: Cash to contribute to the business. A new business owner usually has inadequate insurance unless he or she can utilize personal assets or seek a co-signer with assets to commit to the initial demand.
- Capacity: A track record shows that the business has enough ability to make enough money so that the loan can be paid back.
- Capital: cash to ensure the investment will get returned, but as a new business has few business assets; hence, the lenders hesitate.
Other reasons why banks reject startup loans:
Lack of experience, Lack of customer base and Lack of management.
It is quite ironic that you are asked for experience without gaining experience. You are expected to have a strong management team and a customer base to be accepted for a loan to start a business. But if you can exhibit that you have some influential customers lined up, that might seem convincing and give an excellent impression to the lender, and you might have a chance.
Banks are quite creative when it comes to giving excuses on denying a startup loan.
Some also simply refuse by saying that they don’t give loans to startups. Some banks set strict limits saying only this much is allowed.
Empty promises and mere words:
Indeed, the service industry, like banks and chambers of commerce, operates mostly via word of mouth. But are words enough? Isn’t action necessary?
The banks, chamber of commerce and other such organizations that keep talking about helping people prosper and succeed, giving loans, funding, etc., do they do as they say? Or are these empty promises?
Yes, they are empty words and promises. There are more unsuccessful yet talented people than the successful ones just because no one trusted them; no one held out their lending hands towards them. All that was done was time wastage in false promising.
Role of Chamber of commerce in entrepreneurship:
A chamber of commerce is an organization set up to promote the interests of its members, and generally of businesses. The Chambers of commerce exist at local, regional and national levels. Chambers are also set up to promote enterprises abroad or attract foreign investment.
Members of a chamber of commerce pay a membership fee that gives them access to many benefits and services. The Chambers of commerce can be an excellent platform for the members to find new business leads.
But what about those people then who are not the members of the chamber of commerce. Does the chamber of commerce offer the same level of services, benefits, and protocol to the layman as well?
That’s the issue here!
Members of the chamber of commerce enjoy all the perks, protocols and services while the common man suffers from injustice and unfulfilled promises.
The bitter truth:
The bitter truth is that banks and chambers of commerce only care about one thing, and that is making money. They all make promises after promises, just like politicians. The difference is that instead of a vote, they want our money. So, they promise opportunities for minorities and women to own businesses but it’s a sad fact that at the end of the day, they tend to focus on their people and keep it confined in their circle.
Chase bank and the New President of the Brooklyn Chamber of commerce are both “apparently vowing” this year to break this chain and bring more opportunities to the community.
Are these again just empty words, or is this genuinely happening in 2019?
Does the future hold something good?
Will there finally be true equality of opportunities for all entrepreneurs alike or will there still be a strong lead and vetting process for those of us with high potentials to add to the economic growth of our community. Until when will the strugglers be; marginalized and turned down over and over because of a personal handicap.
Is 2019 the year where leaders and financial institutions will start paying more attention to the opportunities that are presented and less about the looks or less than the entire history of those who offer amazing business models.
It’s time to speak out: Enough is Enough!!!
Instead of only helping successful and prosperous people to get more luxurious day by day, how about taking a serious look at those visionary entrepreneurs with nothing but hope, dreams, hard work and an unbreakable passion for what they do. Why not help those become successful?!
There are way more unsuccessful people in this world than successful, so if they did invest more in those who haven’t found success yet, the fact that they are more in numbers means that these organizations will profit more this way than only helping the few who have already found success.
Conclusion:
Organizations existing to create prosperity SHOULD NOT discriminate on whom to assist to be prosperous. Prosperity shouldn’t be subjected to some particular person who fulfils your so-called parameter. Race, social and financial status shouldn’t be a factor in helping someone accomplishing their dreams of success. If they have a sustainable business model, they should be given a chance and the help they need and deserve.