Atlanta, Georgia (PRWEB) November 28, 2012
IOU Central, a leading online small business lender, has opened up the options for healthy small businesses that need additional capital for continued growth. According to Reuters/PayNet, small business lending sank to the lowest level in more than a year in September 2012. At a time when access to capital remains a major obstacle to small business growth, IOU Central announces its simple interest pricing of 14.99% for a 12-month loan.
Traditional banks have struggled, whether due to tightening lending guidelines, processing costs or increased regulations, to fulfill the capital needs of small businesses, leaving many small business owners searching for alternative lending sources. The Federal Reserve Bank of New York Small Business Borrowers Poll for 2012 stated that 36% of respondents cited access to capital as a barrier to growth. With the emergence of cash flow based lenders, such as IOU Central, small business owners now have an alternative that is fast, paperless, and secure. More importantly, the terms are clear and understandable, allowing small business owners to know the total cost of the loan before e-signing on the dotted line.
With this new set of lenders, small business owners should take the time to understand the differences in lenders and terms. Many lenders offer a pre-computed interest rate or factor rates as found in credit card cash advances and calculate the interest payment for the entire length of the loan, adding that amount to the principle from the onset. The downside to this approach is that, even if the loan is paid off early, the interest is still paid in full. Simple interest, from IOU Central, calculates the interest due on the loan by the principle balance outstanding each day. Therefore, as the loan amount decreases, so does the interest payment. Awareness of these varying interest options can save small business owners money and is critical in determining the total cost of the loan. Small business owners should look for a lender that is transparent and offers a calculation on the total cost of the loan upfront. IOU Central offers any potential borrower its online loan calculator so that there are no questions about the cost of the loan before the application process begins.
“It’s no doubt that there is a significant gap between small businesses that need to secure a loan and traditional banks that are frequently unable to approve them,” said Robert Gloer, President and COO for IOU Central. “Navigating the alternative lending options and terms can be challenging for small business owners who are trying to achieve growth and, at the same time, educate themselves enough to make the right decision in selecting a loan. Interest calculations are an important factor in the overall cost of the loan and with our simple interest calculation, we are extending a “no surprises”, cost effective option to small business owners who may pay more going with a pre-computed rate loan option.
About IOU Central
IOU Central is a leading online lender specialized in helping small businesses with healthy cash flow. Typical customers include medical and dental practices, grocery and retail stores, restaurant and hotel franchisees and ecommerce companies. In a unique approach to lending, IOU Central’s advanced, automated application and approval system accurately assesses applicants’ financial realities, with an emphasis on day-to-day cash flow trends. It makes loans of up to $100,000 to qualified applicants within a few business days, with affordable charges favorable to cash-flow management. IOU Central’s speed and transparency make it a trusted alternative to banks. Based in metro Atlanta, Georgia, IOU Central is a privately held subsidiary of IOU Financial (CNSX: IOU), which is headquartered in Montreal, Canada. For more information, visit http://www.ioucentral.com.