Recently, the issue of bank loans for newly established companies has attracted much attention from organizations and individuals. So newly established companies wanting bank loans need to do what? To find the answer, you can refer to the sharing below.
Why do newly established companies want to borrow bank capital?
Starting a new company wanting bank loans is one of the common and obvious things. Because borrowing capital does not necessarily indicate a lack of fundraising resources. It is also a way to increase the enterprise value in business.
Therefore, borrowing bank capital when a company is newly established is seen as a way to mobilize capital in preparation for business plans. Moreover, the borrowed capital helps the enterprise invest in equipment for production and business activities.
Especially, unsecured loans are a new form but are preferred by many customers. Because unsecured loans do not require collateral, they do not affect the company’s business assets.
However, bank loans for newly established companies face many difficulties. Most banks have regulations for companies that are less than one year old. These companies lack financial reports and business activities to demonstrate repayment ability, thus encountering challenges in obtaining bank loans.
Examples include: state-owned companies, joint-stock companies, 100% foreign-invested companies, joint ventures, etc. These require a charter capital of over 9 billion VND. Additionally, they must provide business licenses, other investment permits, etc.
What should newly established companies do to get bank loans?
For newly established companies wanting bank capital, several challenges arise. Due to the short operation period, they lack sufficient credibility. They often do not possess significant assets for collateral, or banks cannot meticulously appraise their business projects.
However, you may consider borrowing as an individual owner, as some banks support new businesses to borrow, such as VPBank.
VPBank offers policies allowing new businesses to borrow up to a credit limit of 500 million VND. Borrowers are not required to provide collateral for this unsecured loan program, which is aimed at supporting new business startups.
Additionally, you can contact other providers like:
- OneClickMoney
- RoboCash
- Senmo
- Atome Credit
- MoneyCat
- New businesses haven’t yet established credibility and a reputation in the market or with banks due to their short operation period.
- Newly established companies haven’t commenced business activities, thus lack large income sources or substantial assets for collateral.
- Most banks evaluate loan packages based on detailed and meticulous project business plans. But new companies that haven’t started operations yet don’t have these plans for review.
- Loan approval procedures often involve significant costs, leading some enterprises to give up.
Why do newly established companies face difficulties when borrowing from banks?
If the new business has not had any financial reporting activities yet, it cannot provide assets as collateral for bank loans to facilitate approval.
Furthermore, the physical facilities and business plans are not yet developed enough for banks to assess project feasibility. Therefore, new businesses find it very difficult to obtain bank loans. Other reasons include:
So, what should a newly established company do to borrow from banks? All the above information should give you the precise answer. However, to find the right solution, you may contact banks offering support services for enterprises for consultation.
And to ensure that your loan application dossier complies with legal regulations, you can also contact Apecdoc.org for advice and quick assistance with your business documents and licenses when applying for a bank loan.
