Why Is It So Difficult To Get Debtor Finance For My Business?
If you have tried to obtain Debtor Finance for your business and failed to get approval, it may be that your business is lacking in a few crucial areas.
In order to qualify, a financier requires these areas to be in check before they will consider signing off on a facility. Listed below are some of the reasons you may be finding it difficult to get Debtor Finance.
1. Poor Paperwork – A well documented paper trail is a must with Debtor finance, if we can’t track all invoices etc then we can’t do our job properly.
2. Extremely bad credit history – While we mainly look at the strength of your forward order book, we cant overlook history that could prove risky for us. For example if one of the directors is an undischarged bankrupt.
3. The quality of your customers – As we rely on the quality of the invoice and your debtors, it’s extremely important they are strong and reliable.
4. Poorly managed business – If a financier inspects your premises and finds that it’s not cared for and highly disorganised, this is a red flag.
5. Leaving out vital information – If you can’t/wont produce paperwork and financials and if you are evasive or not forth coming with information about your business, this will be an instant cross sign. In order to obtain finance you really need to be an open book.
In most situations we can help, but as a financier we don’t like surprises and need all information regarding your business up front – the good the bad and the ugly.