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What are the Basics criteria for the entitlement to apply for Banking Loan/ facilities?
- Year of Established - Minimum Company/Business set up more than 3 years
- Turnover/Sales p.a. - Company/Business Turnover more than RM 1 mil.
- Reported profit in your account/ Audited Report
- Depends on what industries/ Nature of business
- Company & Directors conducted satisfactory CCRIS & CTOS records
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What types of documents should I prepare for the Banking Loan/Facilities Application?
- IC of company directors
- M & A
- Form 24
- Form 49
- Form 44
- Latest 6 months Bank Statements
- Debtors Aging List
- Creditors Aging List
- Latest 3 years Audited Report
- Existing Bank Letter Offer
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Do I need to provide collateral/Security to the banks? <p >Basically, Banks will request for Property Charge or Fixed Deposit as collateral /Security. Of course, some banks do provides clean loan with small amount. <p > <p >
What are the reasons for a financial institution to reject a loan application?Common grounds for declining credit applications include:
- Applicant does not have ability to repay the facilities applied for
- Purpose of borrowing not in line with facilities applied for
- Unsatisfactory financial results of the applicant
- Applicant has other substantial borrowings resulting in high gearing (i.e. amount of loan is higher than capital)
- Unsatisfactory conduct of current account by the applicant
- Unsatisfactory repayment records with other lenders
- Applicant has cases which are pending legal action
- High business risk such as over dependence on single buyer or supplier
- Lack of financial commitments from business owners (i.e. not willing to commit additional working capital)
- Weak management of the applicant
- Sole proprietor/partners/directors/shareholders/guarantors etc. facing bankruptcy actions from other parties