Sources of Funding for Starting a BusinessFor this task, I will consider the sources of funding that I will need for my business.Why might a business- Do they need financing? Their business may need financing because they may either: • Start a new business and they don't have enough money to get started. • They may need new equipment to help the business to grow and make more profits. • Or they may even want to replace the old machines. • They may want to move their store to a better location which could benefit their business more. • Or they may want -be taking over another company. Additional financing can help a business continue operations while awaiting payments. for its latest sales. It allows a business to meet ongoing operating costs or help it grow. Sources of funding can be classified into two categories: internal and external. Internal finance is money that comes from inside a business or any profit you have made from your business and external finance is money that you get from outside the business. For internal finances, you can keep your profits, reduce inventory levels or sell your old assets, but for external finances, you have more choices: you can borrow money from family or friends for yourself help you can get a grant from the prince's trust, but this will only happen if you have a good idea of ​​what you need the money for and can get a loan from the bank. The difference between a loan and a grant is a loan that you don't have to repay but a grant that you repay because it comes from the bank. There are other types of finance: • Loans • Overdraft • Trade credit • Factoring • Rent • Hire purchase • Grants • Mortgage • Issue of shares • Take on a new partner • Debenture The most suitable source of finance for my business is: Grant - a grant is offered by the Prince's Trust. You will only receive it if they think you have good ideas for a business. Grants are similar to loans, but they're better because you don't have to pay them back. This source of financing is good for any business simply because you don't have to repay. The downsides of getting a grant are very minimal, if any. A complaint may be the long progress of the application, but it will no longer be a problem when you are rewarded with free money..