Small Business Tailoring
To maintain profitability in the current property market downturn, banks and financial institutions are turning their attention to small businesses.
Incentives on offer include:
- lower interest rates,
- packages to attract certain industries, by providing high ‘loan to value’ rates, and
- loans for leasing, debtor finance and insurance premiums.
Loans available cover:
1. Equipment leasing - Suitable for equipment with short life cycles.
2. Insurance premium funding - Enabling premiums to be paid over 10-months.
3. Debtor finance - Debtor payments made directly to the creditor
4. Factoring - The factor buys an SME’s outstanding debtors at a discount.
4. Distribution finance - Used to finance inventory.
5. Property finance – To fund an SME’s real estate.
6. Franchise funding - A loan to purchase franchises.
7. Fleet service - To a fund fully maintained fleet.
8. Vendor finance - Provides third-party finance for buyers.
Small business owners strengthen their negotiation power by proving their capacity to repay, that they have a good credit history and adequate collateral. Other factors are ability to generate cash flow, to be asset rich and that management successfully competes within a value proposition.