Bank rate is the interest rate charged by a bank for making a loan. Bank rates are generally quite low but that is because banks will only lend to only the most proven businesses with the best credit.
They tend to judge businesses base on the 5 C’s: Character, capacity, cash flow, capital, collateral, and conditions. Character refers to whether or not you have been a good borrower in the past. Capacity is the amount of experience you have in the industry. Capital is the amount of money you business needs. Conditions are the rates and terms of the loan. Collateral is what your business can offer to guarantee repayment. This should consist of assets worth around 30% of the funding needed. Even if you have most of the conditions met, you might still be declined. If your business’ s credit is not great, then a bank loan is, for the most part, out of the question. Luckily there are other sources of financing that can get your business the capital it needs.
There are many different types of alternative funding and at first it seems like a daunting task to find the one thats right for you business. We can make the process of funding your business much easier. Just run a capital search in our lender directory to get matched with lenders that could be a great fit for your business.