The first procedure for getting Minority small business loans is to submit an appropriate application form of the financial institutions/banks. It is worth mentioning that there are different types of application forms for different categories of grants. The information furnished in the application covers, inter alia, the following: the name and address of the borrower and his establishment; the details of the borrowers business; and the nature and amount of security offered.
The application form has to be supported by various ancillary statements like the financial statements and financial projections of the firm. The application is then processed by the financial institution-giving grant. This primarily involves an examination of the factors like ability, integrity and experience of the borrower in the particular business. General prospects of the borrower’s business, purpose of grant, requirement of the borrower and its reasonableness are also taken into perspective.
Once the application is duly processed, it is put up for sanction to the appropriate authority. If the sanction is given by the appropriate authority along with the sanction of grant, the bank specifies the terms and conditions applicable to the grant. These usually cover the amount of the loan or the maximum limit of the grant, the nature of the grant, the period for which the grant will be valid, the rate of interest applicable to the grant, the primary security to be charged, the insurance of the security, the details of collateral security, if any, to be provided, and the margin to be maintained.
The detailed appraisal of the project is done by the lead institution. The appraisal covers the marketing, technical, financial, managerial and economic aspects. The appraisal memorandum is normally prepared within two months after site inspection and placed before the Senior Executive Meeting (SEM) for a decision about approval of the project and determining the sharing arrangement among the institutions. Once a favorable decision is taken at the SEM forum and the sharing arrangement worked out, the case is referred to the Board of Directors of the lead financial institution. After the Board of Directors of the lead financial institution approves the proposal, a financial letter of sanction is issued to the borrower.
Related Articles of Interest :
-
Small Business Grants
10 August 2010 8:30 PM |
No Comments
Working capital grants by commercial banks represent the most important source for financing current assets. A firm seeking small business grants is required to submit an appropriate application form. There are different types of application forms for different categories of grants. The information furnished in...
-
How To Get A Small Business Loans
10 August 2010 8:30 PM |
No Comments
To get a small business loan, a firm requires submitting an appropriate application form. There are different types of application forms for different categories of loans. The information furnished in the application covers, inter alia, the following: the name and address of the borrower and...
-
Small Business Loans For Women
10 August 2010 8:30 PM |
No Comments
Small business loans for women involve a number of procedures. Firstly, they have to submit the loan application that seeks comprehensive information about the project. Specifically, the application form covers aspects like promoter’s background, particulars of the industrial concern, and particulars of the project (capacity,...
-
No Credit Check Business Loans
10 August 2010 8:30 PM |
No Comments
Banks grant business loans for different periods- short-, medium- and long-term. Short-term loans are granted to meet the working capital needs of the businessman. These loans are granted against the security of tangible assets – mainly the movable assets like goods and commodities, shares, and...
-
Small Business Start Up Loans
10 August 2010 8:30 PM |
No Comments
Small business startup loans are usually given in the form of term loans. Term loans, also referred to as term finance, represent a source of debt finance which is generally repayable in more than one year but less than 10 years. They are employed to...
-
Short Term Loans
10 August 2010 8:30 PM |
No Comments
Most short-term loans come in the form of payroll advances. This is because it is the simplest way of getting quick cash from a trustworthy lender. Lending institutions review applications based on the capability of borrowers to pay back the loan, which includes the employment...
-
Texas Mortgage Loans
10 August 2010 8:30 PM |
No Comments
Mortgage loans are funds that are advanced from a lender to a borrower upon the latter’s application for a loan. The loans are secured by real property. A mortgage is the document that serves as proof of the property being pledged as security. The mortgage...
-
An Introduction To Commercial Real Estate Loans
10 August 2010 8:30 PM |
No Comments
Unlike residential loans, commercial loans require more robust credit and down payment from buyers. Typically the terms of these loans are less attractive than residential properties. While these impediments reduce the number of qualified commercial real estate buyers, there are many investment trusts and corporations...
-
Payday Loans
10 August 2010 8:30 PM |
No Comments
A payday loan is a short-term loan offered to customers by some lenders. It is also called a cash advance, as it is cash provided against a prearranged line of credit. Payday loans help borrowers take care of their expenses until their payday. People use...
-
Payday Loan Applications
10 August 2010 8:30 PM |
No Comments
A payday loan is an unsecured, short-term cash advance that is repaid by borrowers on or before their next payday. These loans are taken by borrowers to meet unexpected expenses. Though they have a high interest rate, many people prefer these loans because the application...