Turning a business finance ‘No’ into a ‘Yes’

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Recent data from the National Credit Regulator reveals that 54 percent of South Africans are rejected by banks or lenders when applying for credit.

While for many, this rejection for finance is what stands between them and that brand spanking new car; 73 percent of the business owners who took part in the 2018 Real State of Entrepreneurship Survey require finance to grow their business, with many stating a specific need for technology and equipment – a necessity for survival in today’s modern business landscape.

South African business owners must remember, however, that a “no” when it comes to applying for business loan finance, should not necessarily be the end of the conversation. This is according to Jeremy Lang, Regional General Manager at Business Partners Limited, one of the leading risk financiers that paid out R889 million in business loan finance for the 2017/2018 financial year. Lang says that often a business is denied access to finance for reasons that are well within their control.

“In the realm of business finance, a no can mean a number of things, and it is therefore important for a business owner to understand the reasons behind the rejection in order to begin to turn it around. To do this, and hopefully turn that no into a yes, you need to do the following things,” he explains.

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1.Find out why

Referring to a recent SME landscape report, Lang says that the top current reasons for small and medium enterprises (SMEs) being refused finance include insufficient operating history (50 percent), inadequate cash flow (40 percent), limited collateral (34 percent) and a bad credit score (27 percent).

“However, even businesses that may seem to have all of their ducks in a row may still struggle in unlocking the type and level of finance they are seeking. It’s therefore vital that you get comprehensive feedback about what has resulted in your business being rejected for finance,” he says.

2. Work it out 

Once a business owner knows what their business finance application was lacking, Lang says they have the insight required to improve it and try again. “Business owners need to realise that applying for business finance is not a one-time shot. So, for example, if your credit score was an issue, make a point to pay off any outstanding credit card bills and other short-term debt, as these tend to carry the highest rates of interest.

“Aside from getting a tighter grasp on your financials, this may be a good time to relook at your business plan, perfect your business pitch, or consider reaching out to a different financier that is better suited to your business,” Lang adds.

It is important to conduct thorough research in this regard, he says, as each investor or financier will have a precise idea of the type of business or idea that would attract their interest. “It is therefore imperative that entrepreneurs tap into this and ‘play the right field’ to ensure a successful application for finance.”

3. Don’t take it personally

According to Lang, the best way to turn any no into a yes is by having the right attitude and taking rejection in your stride. “Look at each rejection as an opportunity to gain insight from experienced business professionals on what can be done to improve your business and your chances of success.

“Most importantly, don’t lose hope. If you have a business model that you believe in and the hard skin required to make it as an entrepreneur, you have to re-channel the negative energy created by the rejection and make sure you come back stronger in your next attempt,” he concludes.


Business Partners Limited is a specialist risk finance company for formal small and medium enterprises (SMEs) in South Africa, and selected African countries. The company actively supports entrepreneurial growth by providing financing, specialist sectoral knowledge and added-value services for viable small and medium businesses. Visit www.businesspartners.co.za for more information.

Jeremy Lang,
Regional General Manager at
Business Partners Limited

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