When starting a new business, it’s important that you have enough funds in order to really get the startup running the way it should in the most efficient manner possible. If you are an entrepreneur, you may need a loan to start your business, or boost it if you are already operating but facing viability problems. When applying for a loan, you need more details about different types of credit facilities available and Check Into Cash review can be a better starting point. Loans usually come in the form of cash or check and both these payment methods have their advantages and disadvantages as going to be outlined in this article.
Checks Vs. Cash
When you apply for a loan and it is approved, you can get the money in hard cash or in the form of a check. Cash is the most popular payment method since it is accepted anywhere. There are no preconditions required when you buy using cash since all transactions can be performed instantly over the counter. You can even perform very small transactions using cash.
The other advantage of using cash is that you can use it anonymously since no details of the users are required when performing any transaction. The convenience of using cash makes it a preferred payment method among many people. While checks are accepted in different places, some people can legally refuse them, which makes cash better in terms of quick transactions.
The major downside of cash is that large sums of money can be difficult to carry and store. You also face a big risk of losing the hard cash to thieves and it may be impossible to recover the money once stolen. As such, business-wise, checks seem to have many advantages over cash due to several reasons. The following are some of the reasons why you should consider them for the benefit of your business.
A check is easy to carry since it is the same size of paper that represents different sums of money. In other words, a check does not require you to carry large sums of money. If you lose a check, you can cancel it before the payment is required.
A check requires identification details for one to use it. In other words, you may not use a check that is not written in your name. The details on a check make it traceable which helps the law enforcement agents to apprehend the culprits who may fraudulently try to use stolen checks.
When you acquire a loan, you can use it the way you want, but if it comes in check form, then you may face some restrictions. For instance, it might not be possible to use a check to conduct business that may violate the law. This helps the entrepreneurs to remain focused on their business instead of diverting the money for other purposes that may be unlawful.
Checks come in handy for entrepreneurs intending to make payments involving large sums of money on the spot. It might not be feasible to carry large boxes of cash when you want to make huge payments. A check is convenient since you can pay any amount of money that you want using just one form.
Many businesses deal with transactions that involve large sums of money so entrepreneurs can use this convenient payment method. However, it might not be possible to perform smaller transactions using a check since these may require cash.
On the other hand, you should also know the downsides of checks. Some people can legally refuse to accept them though they are acceptable in different places. The major reason why some people may not be interested in accepting checks is that a lot of documentation is required.
If you want to spend your money anonymously, this may not be possible with checks since identification details are required. These details offer verifiable payment proof which makes anonymity impossible.
The other issue is that checks can also pose some security risks, whereby a thief can just copy the account number and routing details from the leaf. After copying these details, a potential thief can then use them to conduct online transactions which can result in loss of money. As long as the details entered are correct, an online transaction is possible, even if you are not the original owner of the account and it may not be easy to trace you.
While both cash and check payment methods are good when performing different transactions, it can be observed that for entrepreneurs, the advantages of using checks outweigh cash. Checks have improved security over cash since they are traceable and you do not face the risks of losing your money to thieves.