Q. Do you have a great idea, but no bank is willing to give you money?
Q. Are you stuck, because of insufficient funds?
Here are some tips from Kuza Biashara on how to approach a bank for a loan for your business:
Present your idea first
Banks are more interested in the idea and prospects of your business. Present the idea in a way that is not only appealing but also convincing. Try to interest and involve the bank officials in your conversation. Talk about the pros and cons of your business. If your business involves producing certain products or services, show them samples of your products. Give them an in-depth explanation about how your products are manufactured and how they can benefit customers.
Banks take a look at your character
After the idea seems convincing to the bank officials, they take a look at your character. Banks take a check of your background to see if you have any past debts, or criminal records, and your current bank account status. Be honest with the bank officials and never try to conceal anything from your bank. If you had any failures, mention about them. Failures make people more cautious and take more precautions than before.
Banks assess your idea
Banks will question you about your idea and how you will be able to make it into a profitable business? Your conviction and confidence is very important. Your answers should be able to convince the bank officials. Explain to them – how you plan to spread your products in the market, how you plan to compete with other competitors in the market, and what are the marketing strategies that you would be using. Be confident about what you say. Don’t stammer while you talk about your business idea and future plans.
The amount of money required
The amount that you need should also be explained to the bank. Tell them how once the business starts, cash flow will help repay the loan. Work out the loan payment time and conditions beforehand. The penalties should also be discussed. If you fail to re-pay the loan, you should provide the bank with security. Security would mean property in the form of a building or land, anything that can provide money to the bank. Always remember that, banks will never provide money without any security.
First impression is the last impression. Banks look out for a lot of details before they give you loan for business. Banks are more interested in the idea and prospects of your business. Present the idea in a way that is not only appealing but also convincing. Try to interest and involve the bank officials in your conversation. Talk about the pros and cons of your business.. Presenting your business ideas in the right way is the key to success.
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