Startups face numerous challenges when it comes to getting financing.
Firstly, many banks lend money on the basis of the 4C’s of Credit. These are Capital (assets linked to your business), Collateral, Capacity (a track record showing the business earned sufficient income to cover its loan repayments) and Character (usually a good credit rating). Since it is difficult for startups to have all of these C’s, it is, therefore, difficult for startups to get loans from banks.
