Business loan
Okay kiddo, so you know how sometimes people need money to start or grow a business? A business loan is when they go to a bank or another place that lends money and ask to borrow some of that money.
Just like when you borrow toys from your friends, the person who borrows the money has to promise to pay it back. But with a business loan, they also have to pay extra money called interest, which is like a fee for borrowing the money.
The bank or lender will look at the person's credit history and how much money they make from the business to decide if they will give them the loan. And sometimes, people will have to put something valuable, like their house or car, as collateral to make sure they will pay back the loan.
So basically, a business loan is when someone borrows money from a bank or lender to start or grow their business and has to pay that money back plus interest.
Just like when you borrow toys from your friends, the person who borrows the money has to promise to pay it back. But with a business loan, they also have to pay extra money called interest, which is like a fee for borrowing the money.
The bank or lender will look at the person's credit history and how much money they make from the business to decide if they will give them the loan. And sometimes, people will have to put something valuable, like their house or car, as collateral to make sure they will pay back the loan.
So basically, a business loan is when someone borrows money from a bank or lender to start or grow their business and has to pay that money back plus interest.