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Securing SME funding "relatively straightforward"

Published On 16 February 2007 at 10:20:03

It is "relatively straightforward" to borrow money to finance a small business start-up, the head of business marketing at the Royal Bank of Scotland claims.

Steve Richards explained that entrepreneurs have a range of borrowing options, although will generally be expected to put some of their own money into the project.

"It can be a simple loan request that is assessed rather like a personal loan is assessed, right through to quite a complex business which is potentially growing rapidly, talking about cash flow impact, the need for an overdraft and whether any assets are being purchased and what is the best way to fund those," he explained.

Mr Richards advised anyone seeking funding to draw up a proper business plan and cash flow forecasts, as well as talking to their bank about overdraft options, explaining that these steps will help make the bank think that you know what you are doing.

He reminded entrepreneurs that they would normally be expected to contribute some of the financing out of their own funds.

"We would normally expect somebody to be making some sort of contribution though. Normally that's about their commitment to their own enterprise. We would expect that they would be investing something themselves in that venture," he explained.

However, options are still available for people with no funds, such as the government's small loans guarantee scheme.

 

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