Bank of America: Loans Essay

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Updated: Mar 18th, 2024

Small business loans

Instruments to the small business borrower

Bank of America is one of the biggest banks in the market. It has millions of account holders and serves many businesses. As many other banks they do offers credit services for small business start up or simply if you want to have some credit available to boost your sales. When you open their ‘small business’ section of the website immediately you notice two instruments that the bank offers to small business borrowers. They are the ‘online banking solutions’ section and the ‘business advice’ section. In the ‘online banking’ section they offer the small business borrower tax services, invoicing, easy online payroll, online money transfer services and payment services. All of these services are related to the buying and selling transaction that a business owner does in his daily routine.

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The other instrument is the advising section where the bank offers to small businesses the possibility of evaluating what is the present situation of the business and what the future possibilities are for it if it selects the bank as its partner.

Short-term and long-term credit services to small businesses. Write several paragraphs to describe them

The bank offers two types of short-term credit services and two types of long-term solutions to small businesses. The first type of short-term credit is the business ‘line of credit’. This service allows businesses to “draw funds whenever you need working capital, seasonal or cyclical cash flow, emergency funds, or other short term financing” (Bank of America, 2010). Furthermore, the business is expected to pay only when this line is used.

The second short-term instrument is the ‘business leases’. With this instruments, small businesses can “borrow the entire purchase price, plus some soft costs, of new vehicles and equipment” (Bank of America, 2010).

The long-term instruments are found in the ‘SBA financing’ and the ‘business loans’ sections of the website. The ‘SBA financing’ options is the recommended long term financing solutions from the bank to small businesses. SBA stands for small business administration loan. The bank does offer this solution to businesses even if they do not fulfill the criteria for other types of loans as described above. This type of loan offers a combination of low rates and longer terms of payment. It is the case when a business needs small injections of cash time after time. The bank divides the loan in rates and offers it to the business monthly.

The other is the traditional ‘business loan’. This type of credit instrument is useful for the business if it is interested in “fixed asset purchases. Business loans provide a one-time lump sum with regular fixed monthly payments” (Bank of America, 2010). Differing from the previous long-term solution, this time the bank offers the sum of money loaned at once to the business.

It should be noted that the website of the bank is quite user friendly and the information is easy to find. It also is very informative, in the sense a business owner can find all the information he needs just by surfing the different sections of the bank’s website.

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Corporate loans

Instruments to corporations

One of the first things that attract the attention of the reader on the ‘corporate and institutional’ section of the bank’s website is the ‘industry expertise’ sub-section. The bank, as with small businesses, offers advice and consulting to potential corporate clients. Since we are dealing with large companies it offers consulting services based on the industry where the corporate operates. The other forms of C&I instruments offered are asset based finance, equities, futures, investment solutions, debt and liquid products, trade services and merchant services. A final section is dedicated to the ‘global expansion’ of the bank over four continents. This section is dedicated to reassure corporate clients that they can conduct business in any part of the world and be sure the bank will be there near them.

References

Bank of America. (2010). “Financing Options”. Web.

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IvyPanda. (2024) 'Bank of America: Loans'. 18 March.

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IvyPanda. 2024. "Bank of America: Loans." March 18, 2024. https://ivypanda.com/essays/bank-of-america-loans/.

1. IvyPanda. "Bank of America: Loans." March 18, 2024. https://ivypanda.com/essays/bank-of-america-loans/.


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IvyPanda. "Bank of America: Loans." March 18, 2024. https://ivypanda.com/essays/bank-of-america-loans/.

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