Viability of the business and its repayment capacity

Surplus operating cash flow projection sufficient to service/repay loan within the agreed tenure

Conduct of existing account is satisfactory

Acceptable Gearing ratio (i.e. % of loan to networth)

Good business/industry outlook

Capability of the management/borrower

Make a presanction visit and is satisfied with the operation of the business

Joint and several guarantee of directors

Any form of acceptable collateral

Common grounds for declining credit applications include:

  • Low ability of applicant to repay the facilities applied;
  • Purpose of financing does not align with facilities applied;
  • Poor financial records of the applicant / poor repayment records with other lenders
  • Applicant obtain other substantial borrowings resulting in high gearing
  • Unsatisfactory conduct of bank account by the applicant
  • Applicant has pending legal action
  • High business risk i.e. over dependence on single buyer or supplier
  • Lack of financial commitments from business owners (i.e. not willing to commit additional working capital)
  • Sole proprietor/partners/directors/shareholders/guarantors etc. facing bankruptcy actions from other parties

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