Helping Businesses By Investing

Mar 5, 2021

Investment is a feasible option for people who aim to build their wealth with greater possibilities of getting higher returns. It is a good way to maximize earnings and strengthen financial capabilities. Every investment is beneficial, but not all are equally strong. Some investments can give better rates than what a savings account can offer you. So, you need to look out for the best choice.

Most investors are guided by the principle that when risk is high, the return will be high as well. But as you learn more about investing, you will realize that it is not just about risks and returns. There are ways in which you can minimize the risks and still get a satisfying yield.

It is important to understand how an investment works and what type suits your financial situation. Thus, take time to appreciate why venturing into a small business is the most practical choice for you regardless of how much you are willing to invest. You can help a business to pursue its objectives, and at the same time, you create opportunities for yourself.

Why Should You Invest In A Business

Have you ever wondered how you can support small businesses in the Philippines and help them grow? The main reason why you must not let go of this opportunity is to have a more decent return. If you have available cash, you must be thinking of some ways to augment your income with the help of that money. Investing is a smart move.

Another advantage of investing in small businesses is to grow your portfolio since you are efficiently using your resources. Instead of keeping your money in your wallet, why don’t you use it more productively? Being responsible when it comes to your money is good behavior that will help you achieve financial goals sooner.

Without the need of starting your own business, you can be part of a business as an investor. You can earn even without being directly involved in the day-to-day operations of the business. Having your money work for you is a mindset that can make you successful in the future.

While you are working as an employee, you are earning from other passive income sources as well. It is only a matter of time before the money you invested will reap rewards. So, it is better to take advantage of that chance now and enjoy the perks later.

Equity Investment Vs. Debt Investment

Commonly, you can choose between two types of investments to finance small business owners. You can either exchange money for ownership or lend money to the business.

Giving your money in exchange for profits or capital in the business is known as an equity investment. The amount of money that you put into the business will be used for different purposes. It is essential to fund daily operations, purchasing fixed assets, and other expenditures. As a result, you are entitled to a percentage of the profits.

Furthermore, debt investments or the act of lending your money to small business owners allow you to earn interest income.

Compared to equity investment, lending money is less risky. But you can have a more generous return here than in fixed deposits of banks.

Photo c/o FeedbackExpress

Benefits of Investing In A Small Business

By investing in a small business, an investor earns through dividends, interest, or appreciation. It delivers promising returns that you might never get from conventional investment strategies.

On the other hand, you give small businesses a chance to achieve their goals. At the same time, it is your opportunity to be part of the next big thing. Therefore, you don’t only get to grow your money. You help small businesses to develop and unleash their potentials.      

Investing In A Business Through Peer To Peer Lending

Peer-to-peer lending or P2P is one of the most convenient ways to invest your money through the use of online platforms. P2P no longer requires business owners to transact with a financial institution to raise capital. They can directly interact with a group of investors to take out loans.

P2P is best for anyone, even for those investors with a small amount of available cash. The process involves crowdfunding or the pooling of money from many investors. Thus, it does not require you to put a large amount.

The amount collected will be available for individuals or business owners who need to raise capital. Borrowers need to sign up to the platform and will immediately get notified if their loan is approved or not.

Here are a few reasons why you must highly consider P2P:

Fast and easy 

Investing is made easy in P2P by registering on the platform. Once your account is ready, you can immediately start lending and transfer the amount of cash you wish to invest. It will only require a few minutes to create your profile.

Getting a regular monthly income

You can expect a regular income in P2P through repayments from the borrowers. After a month of lending your money, you can choose to withdraw your earnings or reinvest them to get more gain next month.

Opportunity to reduce risk

P2P allows a diversified portfolio which reduces your investment risk. Your money is not just entrusted to a single company but into a wide range of business sectors. You can lend money to businesses in different industries. Hence, one default will not automatically mean a total loss on your part.

As an investor, you can evaluate the capacity of your potential borrower to pay the debt. P2P will show the borrower’s profile with all the necessary financial information. 

Help Filipino Entrepreneurs By Investing With is the Philippines’ leading Peer-to-Peer platform and one of the loan products they offer and you can fund are small business loans. Imagine investing in a win-win opportunity like this! Not only do you enjoy great returns in a passive income source, but you also help people turn their dreams into reality.

Open yourself to a fruitful and meaningful financial journey. Sign up as a investor now!