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The best time to manage your business debt in a cooling economy is before the economy cools. Don’t wait until the combination of high cost borrowing and falling revenue impact your business. There are a number of strategies that can help you reduce debt or improve debt management so you’re better positioned to handle any potential downturns.


The ideal way to prepare your finances is to make a list of all your debt obligations, including balance and interest rate, as well as who you owe them to. Once you’ve done this, you can easily see your largest and smallest outstanding debts, how much your business owes, and to which creditors. This step will enable you to better understand where your money is going and how your capital outflows impact your bottom line. Based upon what you find, you may be able to consolidate some debt and refinance at a lower interest rate, which can help save you money.


Debt Management and a Cooling Economy

You may be able to reduce debt faster by increasing payments to the highest-interest loan or by paying off smaller loans first and then concentrating on the larger obligations. Consider negotiating with creditors and suppliers to extend loan terms, change payment schedules, defer payments, reduce fees, or lower interest rates—all of which will make it easier to pay down debt.


One of the best ways to manage business debt is to increase revenue. If your company is earning more money, then you can pay down debt faster. Strategies for increasing sales include expanding your customer base through marketing, focusing on your best-performing products, or adding new product lines to help differentiate from your competitors. The use of special offers and promotions to retain and attract customers can also help you streamline your inventory or introduce your company to new prospects. Other options to increase revenue can be achieved by cutting expenses and streamlining operations. If you do this while the economy is stronger, your business will be in a better position to handle a downturn.


An often-overlooked way to increase business income and manage debt levels is to get your Accounts Receivables up to date. Almost half of small business invoices are paid late and late payments can seriously impact your cash flow or worse yet, your credit rating. You can improve timely invoice payments by exploring billing options for your customer base. Requesting trade references for large purchases, extending shorter credit periods, offering longer payment terms to good customers, or asking customers with a slow payment history to pay invoices upfront is well within the norm of today’s tight credit environment.


Finally, consider securing additional finance, such as a business line of credit, while the economy is strong and your business is doing well. Financing will be harder to get and more expensive in a cooling economy. With flexible credit, you can draw on the liquid capital as you need it later and you won’t have to apply for business financing when it’s more expensive and harder to qualify.


Interest rates create unique challenges in the marketplace, but with some planning and a sound strategy, most businesses can emerge from tough times leaner and more profitable.  The key is to have a financial plan and manage to it.


Do you have questions about managing business debt in a cooling economy? The Funding Strategies Conference would like to invite you to be our guest at the Smart Strategies for Working Capital Under Pressure online webinar. It will be held on Thursday, July 20th from 2-3 PM ET. Normally $29.99, you can join for FREE using the promo code CAPITAL23.






Business Money: UK SME Late Payment Epidemic:


Economics Online: Strategies for Reducing Business Debt:


Entrepreneur: 5 Strategies for Reducing Overall Business Debt:


LinkedIn: 6 Tips for Effective Business Debt Management:


SHRM Executive Network: 8 Tips for Building a Recession Proof Business:

Alternative lenders offer various types of business loans with flexible requirements, but the cost to borrow is usually higher. Many utilize a streamlined application process and provide funding quickly. They very often can provide options unavailable from banks and commercial lenders.


The different funding types you may want to consider are:


  1. A line of credit, which is one option to provide business owners with quick access to capital and borrowers only pay interest on the money used.

  2. A merchant cash advance is given in exchange for future credit card sales. Your company borrows a lump sum of money and is responsible for paying it back daily via a percentage of your credit card sales.


  1. Equipment financing is a loan used to purchase business-related equipment. It requires payments with interest and principal over a fixed term.

  2. Invoice factoring involves selling outstanding invoices to a third party so you can increase your company’s cash flow.


You could also consider applying for a business grant, which is gift money donated by private companies, and federal, state, or local governments to stimulate the economy by funding ideas or projects. Check out to peruse the available options and file applications. Nonprofit foundations and trusts may also offer grant money.


Another option is to raise equity via crowdfunding, where you offer equity ownership in the business in exchange for capital. Loans from friends and family are popular options, just be sure to have a binding contract in place that outlines repayment so you can write off the interest!

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The Funding Strategies Conference next webinar will be

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Major Changes to SBA Financing: 

What you need to know.


Second, you may have been denied if your business doesn’t have enough collateral or capital to secure or repay the debt. Low capacity to repay due to too many outstanding loans.


Lastly, any personal issues which surface and could cause concern for the lender—such as criminal activity or anything unsuitable in your public record would be a big red flag and negatively impact the lending decision.


You can always reapply for an SBA loan—but first, try to strengthen your application by updating your credit information through commercial credit bureaus, streamlining your payments, practicing smart spending, and keeping a credit utilization ratio of 30% or less is favorable.


You may want to consider the advantages of funding from an alternative lender who can provide lines of credit, merchant cash advances, equipment financing, and invoice factoring, and more.

SBA Denied My Loan, What Are My Options?

While an SBA loan is one of the best financing options for small business owners, the approval process is highly selective. More than half of the applicants are turned down. If this is the case for your business, don’t panic—there are options to consider.


First, determine the reason for the denial. Understanding why the lender couldn’t or wouldn’t offer financing will be helpful going forward. Typically, a denial results from one or more of the following deficits. Your credit score may be too low, not detailed enough, perhaps there was a bankruptcy in your recent past, or your business is ineligible for an SBA loan. For more details, follow this link to the Terms, Conditions, and Eligibility section of the SBA website at

What is FinTech and How Does it Impact My Business?

Fintech is short for “financial technology” and refers to technology that streamlines and automates transactional financial services. Fintech makes such services easier to use, more accessible—usually online—and more cost-effective. You probably use fintech every day in the form of mobile banking, making loan or bill payments, or purchasing products online.


How can fintech help you as a business owner? Fintech has many benefits, particularly for smaller business owners who need cost-effective, efficient, customer-friendly financial tools for their company.

Efficient Accounting: Small businesses can use cloud-based accounting software to manage their finances more efficiently and cost-effectively. Fintech tools provide real-time data analytics and accurate financial reporting so a business owner can make informed decisions about sales or inventory management. Other company systems, such as payroll and invoicing, can be merged with accounting to save administration time and costs. This sort of software can also provide secure data backups for your financial information, as well as help avoid bookkeeping errors.


Streamlined Payments: Companies can use fintech tools to create online and mobile payment solutions. Fintech tools enable faster, simplified transactions, reduce processing fees, and greatly improve the overall customer experience. Additional payment options can automate invoicing and provide customers with secure payment portals for to pay invoices.


Cost Savings: Fintech programs often have lower overheads, resulting in cost-effective financial services. By leveraging automation and digitization, fintech solutions help small businesses streamline their operations while also lowering their expenses. A company can automate functions such as payroll or invoice processing using fintech tools, avoiding manual errors, and ensuring accuracy while saving time and money. A solid fintech strategy can even improve customer satisfaction.


Enhanced Security: Fintech companies have developed strong security measures to protect sensitive financial data. They use advanced security technologies such as encryption to safeguard transactions and customer information. For small businesses, this means lower risk of fraud and data breaches, which creates more trust with customers and business partners.

Lending: Fintech has transformed lending by offering business owners alternative financing options. When applying for traditional loans, small businesses—especially new companies—often face strict eligibility requirements, lengthy applications, and long processing times. The newest fintech enables many lenders to automate the approval process based on the information you share about your company.


Alternative lenders use innovative methods, such as analyzing alternative data sources, to accurately and quickly assess the ability of a small business to repay financing—even if the business has poor or no credit history. Alternative lenders can provide a range of funding options, such as invoice financing or merchant cash advance, and process loan applications quickly. A small business may qualify for financing within days or even hours.  


Growth: Also brings real financial tools to your business, allowing more accurate financial modeling and projections to help you better understand your current finances.  This insight can help you make strategic decisions like expansion, a buyout, exploring new product lines, and even planning infrastructure upgrades. Fintech in the hands of an experienced financial professional can help open doors for your company on your path to success.


Fintech does not have to be a scary investment. For small businesses, fintech can provide easy access to capital, improved financial management, streamlined payments, enhanced security, increased accessibility to financial services, and boosted operational efficiency. By using innovative fintech solutions to lower costs and streamline services, small businesses are better able to compete in their market.


As a sponsor of the Funding Strategies Conference, we would like to invite you to be our guest at the Smart Strategies for Working Capital Under Pressure online webinar. It will be held on Thursday, July 20th from 2-3 PM ET. Normally $29.99, you can join for FREE using the promo code CAPITAL23.






Columbia University: What is Fintech?:


Forbes: What Does Fintech Mean and How Can It Help Business Owners:


Investopedia: Financial Technology (Fintech):


Radixweb: What is Fintech?:

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The Funding Strategies Conference

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The Funding Strategies Conference is the forum for businesses to gain objective insights about lending and working capital. Our audience is anxious to hear what you have to say about funding, tips to avoid costly mistakes, smart questions to ask, and how to find the right loans to meet the needs of a business. 


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