Ritika wanted to open her fashion boutique. Though she poured all her life savings in her business venture, she was still short of cash. She needed funds to engage labour and also for buying the raw material for her designer apparels. She was looking for sources of securing finance so that she can start her boutique business at the earliest.

How many times have you faced a similar problem? Cash shortage is a very common occurrence.

There are various funding options. They come to your rescue when you face a shortage of cash. Each option has its pros and cons. But, do you about these funding options? Let’s find out –

  1. Credit Cards

The next most popular source of availing credit is credit cards. Credit cards let you make a transaction, the payment for which is done later. You can, thus, buy goods and services on credit and pay for them later when the credit card bill is generated. Credit cards have a billing cycle which usually ranges for a month. If you buy anything on the first day of the billing cycle, the credit card bill for the purchase would be generated after 30 days. Moreover, the bill would allow you a payment period up to 20 days. Thus, you can avail a free credit for 50 days or more by using a credit card. Moreover, many credit cards also allow you the facility of converting your big purchases into affordable EMIs. Thus, in a cash crunch, you can buy a product using a credit card and pay for it later or in monthly instalments.


o   Credit cards allow you to make transactions without paying immediate cash

o   You can convert big purchases into smaller EMIs


o   Though credit cards allow you an interest-free credit period of up to 50 days, if you default on your payments beyond this time, interest is charged and this interest is very high

o   Credit cards also have other types of charges which increase your expenses

  1. Line of Credit

A line of credit is like a sanctioned loan. Banks and financial institutions allow borrowers a limit up to which they can withdraw funds as a loan. This limit is called the line of credit. However, unlike loans, interest is charged only on the amount of money utilised from the granted line of credit.


o   It is a simple facility which allows you a credit limit

o   It is cheaper as the interest rates are low and are charged only on the amount used


o   It is a temporary source of finance which has to be repaid within a short duration

o   There is a limit to the amount of credit available in this facility

  1. Personal Loans

Personal Loans are the most common and the best source of finance. These are multi-purpose loans which do not require any collateral security. The repayment tenure is high (usually up to 5 years) and many financial institutions also allow flexible repayment options.


o   The loan can be used for any personal or business requirement

o   No collateral security is required

o   The loan is easily and instantly available


o   Being unsecured, Personal Loans usually have a high-interest rate.

o   The amount of loan depends on the repayment capacity of the borrower.

So, these were the sources of finance available if you are short of cash. A Personal Loan is the best source as it is easily available and the loan has longer repayment tenure. You can use a Personal Loan to buy luxury items too. Banks and financial institutions also allow Personal Loan special offers to lure borrowers.

You can apply for a Personal Loan online. The online medium also provides an EMI calculator by which you can find your repayment amount. Moreover, you can check your Personal Loan eligibility before you apply for it. Ritika got a Personal Loan to open her boutique. You can too!