GUIDANCE TO CREDIT

GUIDANCE TO CREDIT 

Step by step to get credit

1. Identify the Need for Credit

Having clear what amount of funding and what is the purpose of the intended use (machinery, equipment, purchase raw materials, increased physical structure, etc.).

2. Information Search and Select Financial Institution

Seek information on the financing lines that best fit the credit needs identified in Step 1 and which financial institutions operate with such lines. Do not forget: The conditions (cost, time, limits, etc.) can vary greatly from bank to bank.

3. Analyze the Restriction Factors

It is crucial to be with all restriction factors (legal situation, guarantees, equity, etc.) appropriate to the needs of financial institutions.

4. Develop the Business Plan

You will need to show the bank that this project is financially viable. The best tool for doing this is the Business Plan. Do not forget: Some financial institutions request that the project feasibility study is carried out with a tool of the institution.

5. Make the Request for Funding

You must go to the financial institution and submit to the Corporate Manager required documentation *, the required guarantees and the business plan, showing the feasibility of the project. After these procedures the financial institution will review the project and returns confirming the release or restriction on funding.

TIPS

• Prioritize finance machinery and equipment, preserving own resources for working capital. On the lines of financing for fixed investment limits are higher, costs are lower, the payment terms are longer and guarantees are facilitated.
• A good relationship history with the financial institution influences positively. Look to contact the bank where you are already a customer and assess the conditions offered. Of course, be sure to investigate other options.
• The bank wants to run the least possible risk. Therefore, it is essential prepare a study with market analysis, product, operations and finance, showing the feasibility of the project and its ability to pay.