Perhaps you are not sure whether your company needs additional money. This questionnaire helps you to discover it.
to ask Bank loan It is much more than filling out an application and asking if everything is going well. First of all, you should ask yourself whether you are really ready to ask about this type of funding or whether your company actually needs it. In such difficult times in which we live, it is natural that fear leads us to make hasty decisions.
Before going to the bank to go into debt, we’ll give you this questionnaire, which you can answer to see if you’re ready to apply for a loan.
I am ready to ask for a loan. What’s next?
You’d better be clear: you have to organize yours Financial information and companies to convince the bank that you are a reputable company and that your business project is really feasible. How does it work? Always looking for the best impression and showing seriousness.
To get started, you need to know the most important banking requirements to apply for a loan. This guide will help you:
What the bank is analyzing to lend to an SME
1. The credit history of the owner or main shareholder of the company in the credit bureau. Remember that as an entrepreneur you are the only true reference when the company is young. It is difficult for them to believe in your company if they do not trust you as a person.
2. Seniority with credit, behavior, number of banking relationships to finance. Your story will tell you who you are (as a person and as a company).
3. Evaluate the company to determine if its revenue is sufficient to pay for its expenses and costs. At this point, you should probably show your business plan.
4. Turnover, operating profit, flows, liquidity, leverage of SMEs. It is therefore important that you have your balance sheets and financial statements in perfect order.
5. Business administration. Who are the people behind the company? At this point, you must demonstrate that the “management” has the talent to lead the company to success and that the operating personnel are correct.
6. Customer portfolio. You must demonstrate that you have a product or service that is required by other companies. It doesn’t matter if your portfolio is still small, the valuable thing is knowing that there are companies that trust what you do.
7. If you are a supplier to larger companies. Why should a bank care about the size of your customers? Simple: If you managed to become a supplier to a multinational or high-ranking company, it means that you have passed the internal quality and robustness controls. This is an additional guarantee for the bank.
If you are already prepared and can properly address the above seven points, it is time to negotiate with your bank. Now four final tips to get you the money you need.
When should you seek funding?
1. If there is a business opportunity.
2. When you try to improve the company (processes, machinery, talent inclusion, international certification, etc.).
3. To fund future sales if you are certain that they will be sold. This usually happens when the business is cyclical.
4. For opportunities to modernize, optimize and grow.
Remember that the best way to deal with the crisis is with healthy finances. Many companies will leave the market not because they run out of customers, but because they cannot survive with fewer sales. When income drops, increasing efficiency is the best way to combat crises.