Searching for financial resources is the task of every large or small business enterprise. And although for a long time, companies chose the most popular solutions, including banks and credit unions, the interest and use of alternative methods of financing have grown significantly, according to experts.

This practice of companies is observed globally because, with the emergence of more financing sources and increasing competition, it is increasingly difficult for banks and other traditional players to keep their customers and offer the most relevant conditions. Secondly, developing technologies and innovative solutions allowed the new alternative players to create a strong, reliable image in a short time and promptly offer the same or better conditions than the financiers who have been on the market for a long time.

The same direction is indicated by the Ministry of Economy and Innovation, according to which crowdfunding platforms have become more and more popular in Lithuania for several years now, because businesses can borrow more flexibly when, for example, bank loans or financing from private and venture capital funds are not suitable, and people with free funds, can become financiers.

The market observes that today big banks lend to businesses in Lithuania, whose loan price can reach up to 6%. Small banks and credit unions continue to compete, offering loans from 6-8 percent. As observed globally, alternative business credits brought innovations to the field and got their share of customers - for example, crowdfunding platforms. Operating in Lithuania for just a few years, they are already lending to companies, applying only 7-10 percent. prices. The most expensive in the market remain the same - quick business loans, lending with 24-26 percent.

"It is understood that for business, one of the most important aspects is the cost of the loan. However, more and more flexible loan granting conditions, funding speed, financier's communication and innovativeness in the market are more and more important," notes Tomas Paliulis, an expert in crowdfunding and head of the risk department of the Profitus platform.

He also names several keys, indisputable pluses of crowdfunding: flexibility of borrowing - a mutually acceptable financing solution based on the principles of partnership is usually sought and found. Many companies are also surprised by the financing time - while traditional big banks assess the risks and perform other standard process steps, crowdfunding players are able to raise financing in less than a day.

A survey conducted by the Bank of Lithuania shows that, at the height of COVID-19, the general standards for lending to companies were tightened by many. After understanding the general economic situation, all banks restricted lending to hotels and restaurants, more than half to real estate and transport, and a third to construction companies. While some tightened and narrowed the conditions, others - alternative financiers - applied new individual solutions to business. According to Profitus representative T. Paliulis, for example, the construction business was allowed to borrow in parts, thus making it possible not to pay for the part of the money that has not yet been actually employed in the project. "First of all, we consider our clients as partners. And the aforementioned example allowed the business to save money during a difficult period, and for us to guarantee long-term cooperation."

Crowdfunding platform "Profitus" on the market in 2020. the amount raised was more than 11 million. euros or even 30 percent. more than in 2019. Currently, the company has gathered a community of more than 13,500 investors. During the entire period of operation, since 2018, Profitus has paid out more than 880 thousand to investors. EUR interest.