How To Finance Your CA Firm?
Your CA firm requires a timely infusion to funds to not only carry out day to day operations, but also to grow and expand. Some of the most common needs of a CA firm is to pay for office rent in the heart of your city’s business district, hire the right auditors and taxation experts, use the best accounting software and invest in short-term courses to be up-to-date with new laws and regulations. Thus, finding an affordable and convenient source of finance becomes paramount.
Before you begin your search for the right funding option, see what your main criteria for finance are. This may be to get finances that offer you a flexible repayment plan, retain ownership of your firm or help you share your financial burden, eliminate the need for collateral or a guarantor, etc. Once you know what your preferences are, finding the right option becomes easier.
Here are some financing options that you can use to finance your CA firm:
- Take A Customised Business Loan For CAs
- A chartered accountant loan is a customised offering that suits the various needs of a CA.
- You can use this loan for financing the working capital needs of your business or to improve the overall cash flow. You can also use it for purposes like acquiring new premises or a new business asset. Thanks to its convenient line of credit facility, a business loan for CAs can help you meet unpredictable expenses associated with your firm with ease.
- A business loan for chartered accountants not only has simple eligibility criteria, but is also collateral-free, easy to apply for online and offers up to Rs.30 lakh at nominal interest.
- The biggest benefit, however, is that you have complete control over your business and don’t have to share decision-making powers with anyone else. This can’t be said for several other forms of finance.
- Use Your Credit Card
- A credit card is a convenient way to finance your daily business expenses.
- This option offers you excellent flexibility in paying various bills. A credit card can also be used with systems like Mobikwik and Paypal to make online payments.
- However, it is important to plan your repayment of credit card bills in advance. Unpaid credit card bills are subject to high interest rates and can stack up a huge debt. This affects your credit score negatively, and may impede future loan applications.
- Attract An Angel Investor
- If your CA firm shows the potential for growth, you can attract individuals who will invest in your company in exchange for part ownership.
- An angel investor can offer you significant sums of finance, which you can use for various growth needs, be it setting up a new office or expanding operations to another location.
- However, these investors may have some say in how you run your CA firm, and may not be the best choice if you want complete control of your business. You are also liable to share a significant portion of the profits and are accountable to your investors for your business’ performance.
- Also, it is important to note that angel investors are more likely to provide funds at the seed stage. That being said, they may only invest until the business owner has also put his/her own funds at risk.
- Get A Partner
- CA firms are often started in partnership to share the risk and responsibility of running a firm.
- You can convert your firm into a partnership by asking a qualified friend or colleague to put in some money in order to become a partner.
- It is important to choose your partner with care as you will share profits and make business decisions together.
- Involve Your Friends And Family
- You can also establish a private limited company by issuing shares to close family and friends.
- Borrowing finance from your family can be convenient, but be sure to draw up an agreement of repayment that is clear to everyone. The downside of this source of finance is that it may result in strained or broken personal relationships if your business does not register continual profits.
Taking all factors into consideration, you may feel like the best course of action to finance your CA firm is by applying for a business loan that is customised for CAs. If you opt for a Business Loan for Chartered Accountants from Bajaj Finserv, you will enjoy many benefits such as a nominal rate of interest, a line of credit facility, online account access, and much more.