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GROUP 2: Advantages and Disadvantages of Raising Finance from Different…
GROUP 2: Advantages and Disadvantages of Raising Finance from Different Sources
Bank
Advantage
Moderate and fixed interest rate
Not related to friends
Lots of loans
Does not affect business ownership
No tax on the loan
The bank is not involved in the business
Disadvantage
Valuable property must be mortgaged
There is a loan term and it is mandatory to pay both principal and interest on time
Complicated bank loan procedures
If the loan is disbursed late, it will be rated as difficult to borrow in the future
Low loan amount
A friend or colleague
Advantages
Paperless
More loving colleagues
Quick loan
Disadvantages
Colleagues do not pay
No interest with colleagues
Easy to take advantage o
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A credit- card company
advantage
easy to do
Interest rate are very high and a bank loan would be cheaper
A credit card is safer than carrying cash.
Earn rewards points when you spend
You can get interest-free days.
A credit card can build your credit rating.
disadvantage
Annual fees.
Other fees can quickly add up
Credit card surcharges
Credit damage
Cash advance fees and rates
Overspending
A pawnbroker
Advantage
Easy to borrow
Quick and easy procedure
Can borrow large amount of money
Able to get your goods back at any time
Disadvantage
Just can only borrow a percentage of the value of the item you’re pawning
Cheaper interest rates elsewhere
Can lose the item if you don’t collect it or default on your loan
A loan shark
Disadvantages
No Reporting to Credit Authorities
Illegal Links
May be at a disadvantage if you do not pay
Sky-High Interest Rates
Advantages
Borrow a lot of money
People with no credit history can get a loan
Borrow quickly
A member of family
Advantage
Loans with no collateral and low interest and possibly no interest
Long term loan
No troublesome procedures
Disadvantage
The loanable capital is not large
Difficult to borrow when family members have other purposes
Relatives will claim ownership of the company
Participate in company work
Affecting emotions when unable to disburse
Đỗ Tùng Lâm
Trần Anh Tú
Phạm Văn Hưng
Lê Hà Linh
Members of group 2