Download
Building “that” Banking Relationship - PowerPoint PPT Presentation
- By lala
- Follow User
- 68 Views
- Uploaded on
Building “that” Banking Relationship. NOV. 2012. Choosing the right option: Debt v/s Equity. Debt or Equity what would be the best option?
Download Presentation 
PowerPoint Slideshow about ' Building “that” Banking Relationship' - lala
An Image/Link below is provided (as is) to download presentationDownload Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.
While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.
- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
Choosing the right option: Debt v/s Equity
Debt or Equity what would be the best option?
- Deciding between equity financing or taking on a loan is a challenge all SME owners face. Should you go to a bank and apply for a business loan? Or should you look for an investor?
Building a sustainable relationship with banks What can the bank do?
Key steps
- Building a Business Case
- Knowing your need
- Understanding your business risk
- Role of finance manager/auditor
- Presenting your case
- Advisory role
- Simple and transparent process
- Need based product delivery
Role of finance manager/auditor
- Develop internal controls in the business.
- Identify business challenges and potential opportunities for greater efficiency and results.
- Identify potential financial risks eg. liquidity in the business.
- Detailed analysis of financial data and its underlying reasons
- Periodic Reporting to Banks.
How to present your case?
- Assessing the suitability of bank capital as a source of funds for the business.
- Matching business needs of capital with different products and services of the banks.
- Preparing an thorough application for bank finance.
- Share a detailed utilization plan of the facilities requested
- Have a mechanism regularly update the bank of material changes to the business
What do banks look for ?
- Banks are in the business of lending and risk sharing
- Banks seek information which is quantifiable, verifiable and sustainable
- Different banks based on their preference and internal know-how define and operate in target markets of their choice
- Lending is based on a variety of factors which the bank seeks to asses
Cause for concern
Re a son
Absence of reliable information
Inadequate accounting & financial statements
High Risk Perception
Lack of proper feedback/references from market
Historical performance unavailable
