It is standard practice by banking institutions to place security high on the list of factors before giving out loans. When taking out a business loan in most cases,your lender will ask you to secure the loan using some form of asset that you or the borrower may own.This security is intended to cover the business loan amount in the event you are unable to pay back.This situation has seen many failing to access finance from lending houses. One institution which has committed itself to changing this is Absa through its development credit fund.
The Absa development credit fund is the right choice for you if your business is a small or medium enterprise , if you are in a position where you would not qualify for a business loan under normal banking criteria due to poor credit records, if you are a South African resident in the country, you must be a shareholder who is fully involved in the day to day operation of the business, you must have the skills or expertise relevant to your business or industry, you must have a well researched business plan, your business should show profitability through historical financials or a realistic cash flow forecast, you must operate in an approved industry, you must show evidence of a revenue stream and your business transaction account is held with Absa.
This credit facility offers you cash amounts from a minimum of R50,000 to a maximum of R3 million with a maximum loan term of five years and monthly reducible overdrafts. 70% percent of this loan is paid directly to your suppliers and your interest rate will be linked to the prime lending rate and will be structured according to the lending risk.
To apply for this fund, Absa can be contacted on 0860040302.