Etude: A French on two TPE needs money, and fast!

Finsquare published a study on the need for funding of French TPE. Among 2.1 million, the TPE represent 2/3 of French companies and employ more than 2.3 million employees. What are their needs and what financing methods of financing available to TPE today?

Almost half of TPE, about 1 million businesses, have strong financing needs, and the majority of them on the short term, we learn of the latest study Finsquare, participatory platform for short-term credits TPE / SME financed by individuals. The loans are a way for small to grow their business and respond in most cases to the following problems in the short  term:

• Purchase of equipment (45% of them)
• Cash financing (44%)
• Financing the growth of the company (30%)
• Purchase of stocks (20%)

While the short-term financing is crucial to the stability and development of French TPE, 1/3 of them entrust it difficult to find such funding sources at their bank.

TPE need to be granted loans at lower cost and faster to unlock

For 73% of TPE, the two most important criteria for signing a loan are the credit costs (interest, insurance costs) and the speed of the loan (loan agreement, delay before the funds are released).   The banks fail to respond quickly and positively to TPE wishing to incur financially attractive short-term loans.

Moreover, traditional banking institutions require a deposit or guarantee and the duration of treatment records loan is sometimes aberrant.

New startups to meet the expectations of TPE

The crowdlending is a form of participatory financing, concerning the fact take out a loan from private individuals.

For example, Finsquare.fr, created in December 2014, allows TPE to make a short-term credit demand(24 months or less) for all types of needs via the crowdlending. Finsquare.fr offers a faster alternative because the platform is back to TPE within 24 hours. Once on the platform, the loan can be contracted in 1-3 weeks from individuals.

Polexandre Joly, President of Finsquare.fr, commented: "This study clearly shows that small businesses are now experiencing a real problem in terms of financing through traditional channels. The added value we provide them is a quick and easy alternative financing for short-term financing needs of small amounts and even immaterial projects. We have just as well in addition to the traditional bank loan. After 1 year of existence, the TPE that have contacted us are satisfied, and some have indeed done it again to us for a second project. "

TPE, you are financing! The new TPE modes of financing are experiencing very strong growth

The bank loan is experiencing a major crisis since the Basel Committee raised its liquidity and solvency ratios. Banks can no longer lend as easily as they did. Since TPE need funding for both maintaining their usual economic cycle than for growth investment projects, other external funding methods explode:

• The use of "love money" ie money from relatives is becoming more common and often comes to starting a company.
• Private equity is experiencing tremendous growth (see "#MaddyMoney: The ecosystem French startup has raised 30 million euros this week").
• Many new methods of financing alternative and innovative little known emerging and can often meet the needs of TPE officers: the mutualisation of bonds, crowdfunding (with Anaxago for example), refundable advances Bpifrance (for the development of Innovation in France and in international cooperation), offer guarantee to TPE from organizations like the Siagi or Bpifrance.