Do you need finance to buy an existing business?

Finance for buying an existing business is treated differently from finance to start a business. Unlike a start-up, if the business already exists, it is easy to check its past financial trading history and the future orders it has already secured, and this makes lenders more comfortable.  

If you are a previously disadvantaged South African citizen who wishes to buy an existing business, then government lending agencies may be your best bet for raising finance.

Below is a list of possible finance options that are available to finance the purchase of an existing business. The best option will depend upon the amount of finance you need, the approval terms and the repayment terms offered by the lenders. Options such as term loans, government lending agencies, and equity finance are suited for the purchase of businesses that require a significant investment. 

If, however, you need a smaller amount to start a business you could consider using raising finance in your personal capacity. In this case,  overdrafts, credit cards or home mortgages could work. 

You might also consider approaching SEFA (Small Enterprise Finance Agency) as they fund both small and large amounts, providing you can show that the business will be sustainable. 

• Term loans
• Equity finance
• Personal or business overdrafts
• Personal or business credit cards
• Home loan
• Seller finance
• Government lending agencies.
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