What are The Good and Bad Reasons To Take a Loan

Team MESH

2 min read

a year ago

Ever wondered what can qualify as good reasons to borrow and what could pass as a bad reason to borrow? In this article, we want to look at some of these examples;

Good Reasons To Borrow

One of the good reasons to borrow is Business expansion. This is perfect for someone already running a business na niko na examples za vijanaa wawili hapa.

First example

Kuna this smart sister ako kwa food business. Anauza samosa, bhajia and the likes but then angependa to get a small fridge ndio aongeze some cold fresh juice to her menu.

Na pia, she could get a blender as well imsaidie kumake the juice. Her problem is that, hana enough to buy the two so she can take a loan to buy the fridge and the blender to achieve her plan.

Second example

Kuna another kijanaa ako na biz ya playstation and ako na PS4 but angetaka to upgrade to PS5, then afungue 3 more shops, aemploy staff wakumhelp na kazi to increase his profits na apate freedom to do other things but hana enough money for that plan.

Huyu pia akiborrow itamsaidia to achieve this growth and expansion.

As you can see from these two examples, If you have a business and you want to expand it or to grow your profits, that qualifies as a good reason to borrow.

Bad Reasons To Borrow

Na sasa, hebu tucheki what are some of the bad reasons people borrow:

• Kuchukua biz loan then unaenda kutumia on personal reasons kama kulipa school fees, ama kulipia babyshower ya beshte yako.

• Kuchukua loan to settle madeni zingine without renegotiating terms.

• Kuchukua a loan to start a biz yenye hujawahi fanya before.

• Taking a loan to start a business na hauna business plan.

So wewe kama a youth in biz, ask yourself this one question before you take a loan, is this a good reason why I should borrow this money? If it’s not, avoid it or else itakuweka in problems you could have simply avoided.