I requested a loan from FNB for the sum of R1 000 000.00 to start up my business. I have personally put in just on R400 000 to get things moving. I am starting a training centre in Cape Town with the aim of getting international approval within 6 months of opening. This is what the loan was for and to keep operating for those 6 months, and a bit of back-up. I submitted a business case with 2 year forecast. There was a property valued at more than the loan that was put forward for surety. I was told this would take a week to get an answer. 5 weeks later it was rejected on the following reasons:
The bank is unable to prove affordability and serviceability based on the information (Cash flow) provided.
The variable Cost of R63 000 per month prior to OPITO approval is considered very high.
The market is SA is considered as being flooded with similar training,
The bank also consider the risk as being high due to it being a start up business.
I find these reasons rediculous. The case flow initially will be low- its a new business, and OPITO approval is within 6 months.
There are NO OPITO training centres in Africa providing this training.
How does a new business start without a bank??
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