A business idea is just a concept until it is implemented and you are only a wannabe aspiring to be an entrepreneur until you give life to your idea.

A business idea is just a concept until it is implemented and you are only a wannabe aspiring to be an entrepreneur until you give life to your idea.

Once you have researched your business idea, gathered all the resources you will need to operate and have completed your feasibility research, it is time to think about how you will start.

You obviously need money to turn your good business idea into a successful venture.

Do you have the money to open doors and start operating?

If not, this is meant for you.

Many factors contribute to the failure of businesses to take off, but a lack of finance seems to be at the top. You must therefore consider the available options.

Unless you have unlimited savings you need to think about how much you need to start operating and where you will get this cash. If you do not have funds you must consider how to borrow the start-up money.

Many sources of finance are available, but will you convince them to invest in your business?

Here are things you should think about to establish if you are fit to borrow money and if you qualify for a loan.

The legal age to get into binding contracts is 21 in South African law. Being younger than 21 does not mean you cannot enter into legal and binding contracts, but your parents or guardians must agree and sign.

Banks will need surety or security before they can lend you money. Surety or security means they need collateral, something tangible, or a guarantee that they will get back their money if you cannot pay.

They need something they can keep until the debt is paid in full and the security goes back to the owner. This means that someone would be willing to take that risk and put up belongings or investments as security for your business. And that means your business plan must be convincing and you must be trustworthy.

The type of business you intend starting will also influence the decision to lend you money.

The Umsobomvu Youth Fund's series of publications on self-employment notes that different kinds of businesses have different legal standings.

Banks are reluctant to grant a business loan to a sole proprietor because the business is not a separate legal entity. The bank would likely only consider granting a sole proprietor a personal loan or overdraft based on his banking history.

Linked to the type of your business is profitability.

Here we are talking about the feasibility of the business, which means its chances of surviving and being able to make enough money to support you and your loan repayment.

This is a major factor the financier of your start-up will consider when assessing your loan application.

And that means your business plan must be convincing.

Many people tend to neglect balancing their expenditure and savings. South Africans are terrible savers. They prefer to use credit rather than cash, even if they have it. Most of us spend more than we can pay.

Financial institutions such as banks can be blamed for throwing credit cards and loans at people without invitation and not considering the person's financial status. People in need of money accept these offers of credit, but often come to regret it when they have to start paying off their loans.

That is how many people end up on credit bureaus' list, which ruins their future credit.

As an aspiring entrepreneur you need to ensure you don't accept unsolicited credit and loan offers because you will pay the price for being careless with money you borrow. Avoid unnecessary debt because it might close doors you need to open.