One common issue that most small and start up businesses often face is the lack of funding. Almost all new businesses or companies will fail because they started off with too little cash. An estimated 77 percent of all small business owners rely on their own personal savings to start off a business. if you have set up a plan to start a business of expand an already existing one, you should consider the funding as your first priority. Government grants are very helpful when it comes to building your business form the ground up.
What are government grants?
As a business persona, you have the power to use government benefits for growing your business. Government grants are given to artists, students, organisations and anyone who has interest in a project or idea meant to serve the country or state positively. You are not expected to clear the payments on a government grant you receive. Essentially, they are free money to start up a business. With a clear purpose and a plan, your request for a grant has a high chance of approval. The issue with application for government grants is that the eligibility requirements are quiet strict.
You have to ensure you understand the advantages and disadvantages of government grants before you seek out for one.
Here are some benefits
They are widely available. You can access a government loan application for your country or state through a website that is set up online. Some government organisations awards grants to businesses that favour renewable energy systems. It does not matter what field or industry your business might be in, it is easy to apply for such loans.
The main benefit of getting a government loan is that you will not have to pay back the loan. Basically, this is free money to start up your business. This is extremely beneficial and will take pressure off you and your business. It gives you the chance to use your savings on another critical part of the business like advertisement. Most times, the government agencies won’t mind taking risks to invest in your business especially when it has potential.
The funding is also available in a wide category. You can get government grants for education, commerce, science and health among other things.
What are the disadvantages?
One of the most challenging parts of applying for a government grant is creating the proposal. You may have one of the most innovative projects in the area but without a great proposal you do not stand a chance. The government agencies that provide this loan have really strict criteria. Completing your proposal will take time, research and energy.
Government grants often come with some strings attached. If you qualify for a government loan, it does not give you the right to use it however you wish to. The most important part is that you stick to the plan and follow all the rules that come with the loan. government loans are short term, if you do not make a profitable plan, you will run out of funds and end up closing the business .