When you shouldn't take out a revolving loan

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Working with a major client . A major client always requires serious financial and labor costs. For example, a leading bank approached a small clothing brand to develop merch. To do this, the individual uganda telegram database entrepreneur will have to hire more employees and contractors to meet the deadline.



There are cases when it is better for an individual entrepreneur or legal entity not to request financing from a bank.

For long-term purposes. A revolving loan is pointless in this case, since the investment will pay off longer than the repayment period. For example, an outerwear brand plans to open a new workshop in a year and expand its business . This requires huge investments and more time. This type of financing is not designed for this.

To pay off other loans. The essence of the product is its immediate investment in business and payback. If you use it to pay off long-term loans, you can get into a debt hole. In addition, the refinancing rate is quite high.