The lowest percentage of small companies applied for finance at the beginning of 2022 since SBI records started and of those that did apply just over 40 percent had their applications approved. This is also extremely low. 

Banks are being over cautious at the moment due to the financial strain and uncertainty of the last few years and small businesses are being urged to try and find other sources of finance rather than rely on loans they are unlikely to be approved for in the current financial climate. 

 Having said this, it seems it is harder to find funding options than you would imagine and one in five small business owners don't know where to find funding to help their businesses grow.

Here we will discuss five ways to raise funding for your small business or start-up without having to apply for a loan. 

Crowd funding allows you to raise money you need for a certain business venture or product by asking the general public online. It is a good option for businesses with growth potential but it can also be a time consuming option for funding.  The larger the amount of people you can reach with your crowdfunding idea, the more chance of getting funding but you may need to invest a lot of time and effort into publicising your initiative in order to hit your funding target. 

Business angels are wealthy individuals who can provide your business with funding in exchange for shares in your business and profits. If you are happy to give away a share or percentage of your business then a Business angel could be a good choice. Some investors will not only put money into your business, but they can also have experience or ideas you may benefit from and many can offer you advice and guidance. 

The Government actually rewards innovative companies and there could be free money for what you do with your business. You would not have to repay a grant if you were eligible for one. You must however be doing the right type of work to qualify for a grant. 

Venture capitalists are investors who put in a much larger investment than an angel investor would. You would give them equity in your business in exchange for their investment. In addition to the funding, venture capitalists will offer business expertise to help your business. They are often well networked and can provide contact to other helpful people in the business world. To use a venture capitalist, you would be likely to have to hand over a big percentage of your business. 

You may decide to ask your family and friends for support with your business. This option works best for those in the start up phase that need an initial boost to get them to the point where they can apply for other funding options. For friends and family, it could be a good investment provided you offer them something in return such as interest on their loan. However mixing business with relationships can be a problem when things go wrong. How understanding would your family be for instance if you lost their money and had no way to pay it back. This would need to be discussed and considered by both parties before any action was taken.