Self Employed Loans | Complete guide 2020

There are organizations and banks that offer a variety of loans for freelancers that require financing the beginning of their professional activity or expanding their activity. However, it is often difficult to access them.

Although the economic crisis affects all types of companies , the self-employed are the most vulnerable to suffer the consequences and have found themselves suffocated, with endless difficulties to pay for suppliers and services.

Different aids for freelancers

Although banks generally grant loans to the self-employed, the conditions that are required every day are stricter due to the high percentage of risk that exists when granting loans, which makes it difficult for self-employed professionals to cope with the Payments. However, at present many public and private entities have emerged as alternatives and that are of great help to solve liquidity problems.

ICO financing

One of the most popular when looking for financing is the help that comes from the ICO Official Credit Institute and that offers loans that can be used to buy computer equipment, machinery, cover liquidity problems or mandatory payments. You have much more information about this line of credit in our ICO loan guide, where we explain them in depth.

The self-employed have 3 ICO financing lines that they can process directly in any bank that is attached to the institute, with very low interest rates and that vary according to the amount of fees that you want to pay.

Some of the obligations to access these lines of credit is that the money received must be used for the business and justify each of the expenses, so it is necessary to save all invoices, vouchers, payroll ...

It is not very easy to access an ICO line of credit because in recent years the percentage of applications that have been approved has dropped considerably, so it is recommended to make the application with the help of specialized consultancies in this type of procedures and that they have the ability to do so in a more optimal way than certain financial entities.

ICO line for companies and entrepreneurs

It is aimed at companies and freelancers who carry out their activities in Spain who need financing to develop projects or general needs such as expenses, payroll, payment to suppliers, purchase of merchandise ..., acquire assets, companies, vehicles or make reforms to real estate.

The maximum amount of this type of aid amounts to 12.5 million euros , with an interest rate that can be variable or fixed and can be requested throughout the year 2019.

SGR / SAECA guarantee ICO line

To finance investments in productive fixed assets or when liquidity is needed within the national territory or abroad such as investment projects, adaptation and reform of facilities, acquisition or creation of companies abroad, expenses, payroll, payment to suppliers…. Financing must be endorsed by an SGR (Reciprocal Guarantee Society) or SAECA (State Anonymous Agrarian Surety Company).

The maximum contribution is 2 million euros per client , with a fixed or variable interest rate and will be in force until December 27, 2019.

ICO line for Internationalization and export in its sections I and II

To finance investment, liquidity and export operations in the medium and long term . It is an aid intended for companies, freelancers and entities that have at least 30% of Spanish capital.

It is a very innovative product where you can obtain loans of up to 25 million euros per client and that has been created with the intention of promoting international investments.

Throughout the year 2019, this request can be made to which a variable interest rate is applied and, as well as the dates and the form of settlement, will be agreed between the credit institution and the client.

The improvements of the ICO lines for this 2019

  • The lines for this year have improvements in their conditions and that allow them to be adapted efficiently to the financing needs.
  • They finance both investment and liquidity activities in terms between 1 and 20 years.
  • The client grace periods have been extended for transactions formalized to a term exceeding 10 years with the option of a 3-year grace period for capital.
  • New measures are implemented to simplify the process , procedures and management of the different operations.
  • Improvements have been made with regard to the control and verification processes of ICO lines towards models that are aligned with European counterparts.

With all these improvements, ICO lines are more flexible and adapt to the financial characteristics not only of companies but also for the self-employed, which favors their growth, investments in Spain, activity and internationalization in other markets.

Loans for SELF-EMPLOYED | Complete guide 2019
Self Employed Loans | Complete guide 2019

An innovative product for the self-employed

Applying for financing is not easy. That is why now the self-employed can count on a new simple and comfortable product that allows them to apply wherever and whenever they want.

We are talking about the “ ING Business Credits” , which allow access to a good list of banking services such as the 10 BUSINESS Credit, to be used online from the computer or mobile.

In just 10 minutes you can have an answer and know if you are going to enjoy the credit or not, which is adjusted to the needs of each client, with an interest rate that depends on the type of activity.

It is a fairly flexible alternative that allows you to decide how much money you want and when, considering that, with each provision, a repayment period is opened that ranges from 12 to 36 months and the amount you want, it is even possible to repay each loan whenever you want and without having to pay commission.

This online financing means a great saving in commissions since, only a 1% opening commission is paid and that is applied only at the time of contracting the loan.

Because it is an online procedure, it is not necessary to present any documentation , only an analysis is made automatically on the activity of the business accounts in another entity. In this analysis you can include the accounts you want, which will allow you to adapt the maximum amount and at the best cost.

One of the advantages of this type of financing is that you do not need an endorsement or cumbersome procedures , you just have to open a "Business Account" to enter the loan in this way.

Thanks to the fact that it has a simulator that allows you to know how much the fees, commissions and any other detail of interest will be.

Different platforms

It is possible to enjoy a collective financing network , usually online and known as crowdfunding, to obtain financing for certain projects in exchange for rewards or participations altruistically.

How does it work?

Although it depends on the platform that has been chosen for financing, the main phases are :

  • Submit the project to be a candidate for funding. It is necessary to indicate a description, the amount that is needed, the time to raise the funds that is needed and the type of crowdfunding that is going to be chosen.
  • The community or the platform value the interest of the project .
  • The project is published on the platform for the time indicated in the application and it is the time that people have to make the investment.
  • The project is promoted to the maximum during the time that it is published, which will allow to obtain the financing.
  • When the established deadline ends, the project is closed and we proceed to verify that the amount of financing has been obtained.

What documents are needed?

Self-employed workers must have a series of documents in printed form , essential to request some type of loan:

  • DNI .
  • If the worker has been self-employed for years, it is good to prove it with statements from previous years and thus increase the confidence of the credit company.
  • VAT and personal income tax return for the last year if you already work as a self-employed person.
  • Personal income tax return for the last three months .
  • Accounting data of expenses, profits and income.
  • When it comes to private equity financing, it is often necessary to have a business plan .

Is it difficult for the self-employed to get financing?

If you are a self-employed person who has all your debts paid on time and has been in the market for many years , you will not have difficulties in accessing the different financing services like most consumers.

For new freelancers or young entrepreneurs, it becomes more complicated . However, we must try to have innovative projects where the investment is minimal and access financial solutions online.

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