Understanding FinnUp’s Debt Marketplace

Any business, regardless of its size or industry, requires funds for various reasons. A business can require funds for their day-to-day operations, a capital-intensive project, or simply to ensure that their cash inflows occur on a regular basis. Businesses may need to raise funds anywhere in their business cycle- be it their initial stages, or for growth and scalability in the future. While this is established, does it mean that any kind of business can take any type of business loan, for any amount of money? Of course not! It would be like wearing socks for gloves - it just doesn’t fit! So, what are the types of debt products available on the FinnUp platform and for your business? Let’s break it down.

Here’s how businesses at FinnUp are classified:

Cash Credit / Working Capital Demand Loan

As you may already know, businesses require capital on a daily basis for day-to-day operations. A working capital demand loan is a flexible funding option for businesses looking to raise capital. It is readily available, which makes it a product to raise capital for operational requirements.

Term Loans

Term loans are categorised into short-term and long-term loans. The repayment period ranges from less than 12 months, to 12 months to 5 years, respectively. Usually, term loans are used to refer to short-term loans.

Term loans are repaid in regular payments over a specified period of time, the tenure finalised at the time of the application.?

Finnup offers an easy way to obtain term loans from reputed lenders in India. Apply for a term loan online and get connected to the right lenders for your funding needs.

Project Finance

Project finance is the funding of long-term infrastructure, industrial projects, and public services using a non-recourse or limited recourse financial structure. The amount borrowed is repaid through the revenue generated from the project upon its completion. On FinnUp, you can finance your project from our network of investors. It provides the most comprehensive, secure and hassle-free solution to financing your projects by connecting you with the right investors for your business idea.

Machinery Finance

Just like the name suggests, machinery finance is especially for machinery or heavy equipment. It is a credit facility that helps businesses dealing with equipment to purchase, repair, lease, and upgrade their machinery without affecting their productivity.?

Loan Against Property (LAP)

Just like the name suggests, LAP is a credit facility where you can raise capital by setting a property as collateral. The asset remains as a collateral until the total capital borrowed is repaid by the borrower. Our vision, at FinnUp, is to bring you the right loan providers for your needs. We make it possible for investors to avail of high-return loans with data security and transparency.

Lease Rental Discounting

Finnup brings a technology-enabled LRD platform with a mission to simplify the process of obtaining term loans against rental receipts. It aims to make leasing & renting a hassle-free, seamless and transparent experience by providing access to best-in-class technology.

Trade Finance

Trade Finance is an umbrella term since many financial products fall under this category. To give you the gist of it, trade finance reduces the probability of delayed payments. Trade finance is a way to ensure the exporter receives payment according to the agreement while the importer might be extended credit to fulfil the trade order. A third party is involved to ensure the exporter is paid on time.

Short Term Loans

Similar to term loans, short term loans are loans for a tenure of less than 12 months.?

Non-Convertible Debentures

Non-convertible debentures are tools to raise long-term funds by companies through a public issue. FinnUp helps you buy and sell non‐convertible debentures. It connects corporates to those who want to invest in non-convertible debentures for capital appreciation and returns, at the same time allowing corporates to get funding from investors.

Bank Guarantees

A bank guarantee is a financial safety net of sorts. It is offered by a lending institution, where the lender ensures that the liabilities of a debtor will be met. In other words, if the debtor fails to settle a debt, the bank will cover it.?

Promoter Financing

Promoter financing is one of the most reliable funding options available for businesses. It is used by promoters to grow their business or to increase their stake in the company. Its rising popularity is due to its flexibility. It can help fund the needs of the business, whether that is scaling of new operations or starting a new ancillary business.?

Revenue-Based Financing

In Revenue-based financing, or royalty-based financing, investors receive a percentage of the business’ income as returns. A predetermined amount is to be paid to the investors, usually three to five times of their original investment. No interest is to be paid, and there are no fixed payments.?

Unsecured Loan

Unsecured loans are loans that do not require any collateral, but have a higher rate of interest. They are issued based on the borrower’s creditworthiness. In other words, it is essential to have a high credit score to obtain an unsecured loan. There are many types of unsecured loans, like revolving loans or term loans.?

Unsecured Term Loans

These are loans that can be repaid over a period of time, in equal instalments. These loans are generally secured, but they are offered unsecured by fintech companies.

Warrants

A warrant is a long-term option to buy a stock at a fixed price. It is issued by the company and gives the holder the right to purchase the company’s stocks at a particular price, on a particular date. Since it is issued by the company, the shares are received by the company directly, and not by other investors.

Invoice Discounting

Invoice discounting is a method of financing used in case the company is in need of working capital. The company can submit invoices as collateral to lenders, who will provide up to 95% of the amount as a loan. When the invoice is paid by the company’s debtor, the loan can be repaid along with the agreed-upon fees.?

PO Financing

Purchase order financing is a cash advance available to small businesses for their purchase orders. Lenders pay the business’ suppliers and deliver the products to the customers. The customers pay the lenders directly, and the lender pays the amount to the business after deducting their fees.?

Working Capital

Working capital loans are short-term loans used to finance the business's day-to-day activities. They have to be repaid at the demand of the lender, and they are usually secured with the assets of the borrower.?

At FinnUp, we offer a one-stop solution for all your debt requirements. Let’s raise the right type of capital for your business. Join FinnUp and start your journey towards financial upliftment.