Borrowings
Banks are not risk capital: they will look at three key areas to keep the risk of non-payment to a minimum:
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Ability to pay interest and repayments as they fall due. Your business plan must demonstrate that the business will generate sufficient cash flow to make these payments. Banks will take into consideration management experience, track record, character and a sound (and proven) business model.
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Security to underpin the loan that can be called in if interest and capital cannot be paid as contracted.
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An acceptable
Capital Gearing to ensure that the business is not too reliant on debt finance.
