• Home
  • Entertainment
  • Crime
  • Sports
  • Celebrity Gossips
  • Across the Globe
  • Business And Money
Top Posts
Iran frees more Europeans after a prisoner swap
Twitch streamer Puppers, who lived with MND, dies...
Utah primary schools ban Bible for ‘vulgarity and...
Lake Maggiore boat accident: Questions remain over spy...
India train crash: More than 230 dead after...
Sudan conflict: Rockets hit Khartoum market as talks...
British Airways fined $1.1m by the US government
France influencers: Jail threat for those found flouting...
Mexican police find 45 bags of human remains
US President Joe Biden trips and falls at...

  • Home
  • Entertainment
  • Crime
  • Sports
  • Celebrity Gossips
  • Across the Globe
  • Business And Money
0

Practical ways to increase your chances of getting loans

Many small business owners have lost confidence in their ability to secure loans from commercial banks and other lending institutions due to denials they might have faced in the past.

However, the major concerns of banks are the ability of borrowers to repay loans, earning a reasonable interest on the loan and the protection of funds depositors have entrusted in their care.

As such, there are strict criteria for accessing credit in order to minimise the risk of losing their funds to business owners who are not credible.

For business owners to be eligible for loans, there are preliminary preparations they have to make.

Have a good credit history

In order to increase access to loans, business owners have been advised to have a good credit report. This will boost their access to finance for growth and expansion of their businesses.

A credit history, according to investopedia, is a record of a consumer’s ability to repay debts and demonstrate responsibility in repaying debts.

It says a consumer’s credit history consists of information such as: number and types of credit accounts, how long each account has been opened, amounts owed, amount of available credit used, whether bills are paid on time, and the number of recent credit inquiries.

Experts advise entrepreneurs to review their credit report before applying for a loan because lenders use the credit history to help them decide whether they are creditworthy.

For people who have not obtained a loan before, the Managing Director, CRC Credit Bureau, Mr. Tunde Popoola, encourages them to obtain a loan, and then pay back promptly to establish a good credit history.

 However, he says such loans may not just be from the banking system because those who have enjoyed facilities in other places and have deferred payment, even though not in a bank, can have their information submitted to a credit bureau to build a credit history.

 Possess acceptable collateral

Research has shown that microenterprises and SMEs have little or no property but they do have a wide range of productive assets that can easily be harnessed to serve as collateral for obtaining loan.

For business owners who don’t have landed properties that can serve as collateral, a representative of the Monitoring and Evaluation of the Department, National Collateral Registry, Dr. Olasupo Musa, says they have the opportunity of securing loans with moveable assets with the establishment of   a collateral registry.

According to him, a collateral registry is a databank where moveable assets are registered for the purpose of being used as collateral to obtain facilities from financial institutions.

Invest your money first

A business consultant, Mr. Olufemi Onasanya, says one of the ways business owners can improve their chances of getting a loan is to invest some of their own money in the business.

He says lenders are more attracted to entrepreneurs who have at least 25 per cent equity stake in the businesses they finance.

Have a solid operational structure

For entrepreneurs who are looking to expand their businesses, experts say a good operational structure will give clarity to employees, enable departments to work efficiently and boost productivity.

And as part of a strong business structure, Onasanya says having a good business plan will convince the lending institution of high chances of the borrower repaying the loan within the stipulated time frame.

To ensure that you are considered for a loan, he says the business plan should show financial forecasts, your marketing and sales strategy, information about your management team and staff, and other operational plans.

Practical ways to increase your chances of getting loans was last modified: July 14th, 2016 by ABBStaff-Mayowa
0
Facebook Twitter Google + Pinterest
atoluwashe@gmail.com'
ABBStaff-Mayowa

previous post
FG stops remittance of workers’ pension deductions
next post
Things to watch out for when opening a savings account

You may also like

Naira closes the week at N385 to...

5 Tips to Managing Your Wealth in...

FG stops remittance of workers’ pension deductions

Who Accepts Bitcoins As Payment? List of...

Challenges of the fashion business

Profitable Livestock Farming Businesses in Nigeria

We’re losing N238bn monthly to theft –Power...

How To Start Goat Farming In Nigeria

4 Things to know about Company formation...

How to Start a T-Shirt Printing Business

Leave a Comment

Keep in touch

Facebook Twitter Google + Instagram Pinterest Linkedin Youtube Email RSS
  • Facebook
  • Twitter
  • Google +
  • Instagram
  • Pinterest
  • Linkedin
  • Youtube
  • Email
  • RSS
Footer Logo
  • Home
  • About Me
  • Contact Me
  • Advertise On This Blog
  • Share Your Stories
  • Privacy Policy
  • Terms of use

©2023 - Aderonke Bamidele's Blog. All Rights Reserved. Designed and Developed by ABB


Back To Top