Take advantage of FNB Loans for Business | Cheap Interest Rate

Take advantage of FNB Loans for Business | Cheap Interest Rate

For those who own companies or small businesses sometimes it is hard to find a bank that helps them grow. This article will explore the business loans options offered by one of the most reputable banks of the country: FNB. If you are looking for convenient loans for business, keep reading to find out the different credit lines, how to apply for them, what are the requirements and much more.

Who qualifies for the COVID-19 Loan Guarantee Scheme at FNB?

The first National Bank is one of the six banks that will provide the COVID-19 loans announced by the President of South Africa. As of May, 12th small and medium businesses can contact FNB to apply for this loan. This loan will be paid to businesses in three payouts and can be repaid in up to 66 months with a period of six-month payment holiday. Of course, the business might choose to repay the loan before schedule with no penalties.

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The idea behind this scheme is to help the companies that have been deeply affected by the current pandemic and lockdown. This loan risk is mutually shared by the Government and the banks. No profit is intended, the aim is to allow companies to cover their operational costs and remain alive through this crisis.

For a business to qualify for this scheme, it should:

  • Have a turnover below 300 million rands
  • Being in good standing with the bank
  • Being registered with the SARS
  • Having been affected by the COVID-19 pandemic

How to Apply for a Business Loan at FNB?

If you own a company or manage a business you might already know that for your business to grow, sometimes it is necessary to ask for finance. First National Bank is one of the oldest and biggest banks of South Africa who brings different types of loans and can be the key to the future of your company. Throughout this text, you will find information with regard to the different options offered by FNB along with their benefits. For now, we want to tell you that if you are an FNB client you will only need to fill out an online application. If you are not a customer, you will need to contact the bank.

What is the Interest Rate like for FNB Business Loans?

FNB offers a set interest rate for its business loan. However, the exact number will vary on several factors, such as the revenues of your company, the amount of the loan, the term you choose, among others. When you start your application and send all the documentations that FNB will request you, the bank will assess your situation and run credit checks on your company in order to set the interest rate of your business loan.

Many business men worry about the amount of the repayments and are uncertain as to how to calculate them. One way to solve this is using loan calculators. Of course, you will not be able to know the exact numbers of your business loan, since that information will be available to you once your application is approved. However, this estimation might help you start planning and setting budgets.

One tip to get the lowest interest rates possible is to cancel all loans and pay all outstanding bills your company may have before starting the loan application. This will directly impact on your credit score and it might translate into lower rates.

5 Requirements to Ask for FNB Business Loans if you are not a Customer

Usually, business loans involve great amounts of money. It is different from personal loans where top figures are around R250 000 and R300 000. Business loans can be much higher than that, and for that reason requirements can be stricter. The bank needs to know if your company will repay the loan.

If you are an FNB client, things will be much easier since if you need to borrow less than R400 000 you might not need to give the bank any documents. If you ask for more than that, you will only need to give the bank your company’s financial information and projections.

Now, if you are not an FNB customer, the bank has no information about your company. So, you will have to meet the following 5 requirements. 

  1. Your company’s bank statements for 6 moths
  2. Financial statements of one year and management accounts
  3. Cash flow statements, balance sheet and statements for income
  4. Business plan to prove if your company is viable and sustainable
  5. If your application is approved, you will have to open a Business Account at FNB

What are the main Characteristics of an FNB Business Revolving Loan?

You may be familiar with the concept of a revolving loan. You probably know that this type of credit facility allows you to use the funds in the loan as you need them. FNB Business Revolving Loan allows you to pay it in installments and once you‘ve paid 15% of the initial loan you can borrow again the same amount as the original one.

Below we will list the most important characteristics of this loan.

With FNB Business Revolving Loan you will be able to pay it back in fixed installments helping you to plan ahead and budget your finances.

  • The minimum amount of this facility is R20 000
  • If you pay back 15% of the loan you can access your funds whenever you need
  • This loan can be applied for online, and if you are an FNB client you can apply through the online banking application of the bank

FNB Business Loans VS Revolving Loan — 3 Points to Compare

You might be at a loss as to how these two facilities are different from each other. Although it is true that they share some similarities, they differ in important points. Here we will talk about the main 3 differences between these credit lines.

  1. Limitations on the amount you can borrow. With a Business Loan you can borrow, for instance R500 000 and that’s it. If you happen to need more money you will have to ask for another loan, whereas with a Business Revolving Loan, after you pay a percentage of the loan you can ask for the whole initial loan amount.
  2. Interest rates. Usually business loans have lower interest rates than business revolving loans.
  3. The term of the loan. In the case of a business loan you have a term in which the loan will expire. That is, you ask for, say, R300 000 and choose to repay it in 24 months. In that way you know exactly when that loan is no longer in place. A Business Revolving loan, on the other hand, can be extended for an indefinite time period.

What is FNB Business Booster Loan?

If you own a small business and want to make it grow with an injection of cash into your operations, this product might be what you need. FNB has created this Business Booster Loan to help South African companies find the finance they need to run the operations that will make their company grow.

With this loan, you can borrow from R10 000 to R100 000 and pay it back in fixed monthly installments up to six months. This loan is ideal for those companies that are either starting their business or that are stuck and cannot expand their operations as its owners would wish.

Besides from the fact that this facility is convenient and accessible, it is a good thing to know you would trust the future of your company to one of the most reputable banks in South Africa. First National Bank has been leading the credit market for many years due to their expertise and reliability.

3 Qualifying Criteria to Get FNB Start Up Business Loans

As it was mentioned above, FNB has designed a financial facility called Business Booster Loan that is just what a startup business or a small business might need to grow and expand. If you are the owner or you manage a company and feel that you can become a bigger company with the help of this loan, you should check out what you need in order to comply with FNB’s qualifying criteria for this loan.

  1. Your company must have managed its turnover through a Business Account of FNB (for 6 months)
  2. You need to have a Business Account in good terms
  3. You must keep a good credit history

If you fulfill these criteria, you will need to contact the bank to ask for this facility since no online applications are offered.

This product has several positive reviews by FNB clients. Many people commented that FNB staff members were very kind to them and that they took the trouble of explaining every detail and clearing any doubt. If you have already taken out a Business Booster Loan at FNB, please tell us in the comment section what are your thoughts about it.

Does FNB Offers Unsecured Business Loans?

An unsecured loan is one that does not need any security to act as guarantee for the loan; so that in the event you are not able to meet your repayments the bank can use the security to procure payment. In many cases this security is a property. Usually small companies do not have properties to use as guarantee, and they find it very hard to seek finance.

The Business Loan that FNB provides to its customers can absolutely be unsecured if the amount you want to borrow is below R400 000 and if you meet certain requirements set by the bank. These requirements will have to do with the financial situation and credit history of your company.

FNB is a great option for those small companies or startups that need to finance their operations and it is available no matter if you are an FNB customer or not.

We get a lot of comments from our readers saying that they find it too hard to obtain finance. They feel that some banks ask impossible requirements and their applications are denied, making it impossible for their companies to grow. FNB is here to lend you a hand in your pursue of expansion and growth. The objective here was to let you know the loans available at FNB, and how to take advantage of them to lead your business to the path you’ve envisioned. 

Preguntas Frecuentes

Will I need a bank account?

Yes, so that the company can deduct payments from there

Is the office open on holidays?

No it is not

How long does the application last?

Less than 30 minutes

What are the conditions on repayment of the loan?

The conditions on repayment of the business loan have been established by FNB. FNB will give you the possibility to repay your loan on flexible terms, that is, from three months to five years. These are the terms on which you will repay your business loan. You can carry out the repayments through debit orders.

What are the conditions on repayment of the loan?

Depending on your needs and possibilities as well as those of your company, you can opt to repay your business loan at FNB from three months up to 5 years. The minimum amount for this loan is R2,000. Besides of the flexibility in repayment, FNB also lets you apply online!

My business just secured its 1st tender, I need R250 000, how much will my repayment amount be?

The repayment amounts you need to think of for a business loan at FNB will be subject to the interest rate your business and the repayment term you choose. In order to show you an example, we will suppose that you are offered the lowest rate possible (7 %) and you decide to pay it in 72 months. In this case you would pay 4378 rands per month.

I need a business loan to invest in township property. I want to build a 12 double storied units.

At FNB, you can ask for a business loan to invest in township property. Of course that for you to be able to ask for a loan to build a 12 double storied units, you will have to meet all requirements asked by FNB. For business loans over 400,000 rands, you will need to provide security.

Can FNB help to buy a franchise?

Of course, it can. First National Bank offers convenient financing programs tailored to the clients' particular needs and budget to start a business or to develop further. This means that you can obtain the necessary funding to acquire a franchise or to add another location. With this entity, you can make your business successful. 

Does FNB fund start up ventures?

It is important to notice that First National Bank is one of the main banks in South Africa that offers several financial services for the business sector. In other words, you will be able to obtain the monetary help you need for your business, whether it is small or medium-sized. You can contact the bank to obtain more details about funds for start-up ventures. 

Does FNB help with business proposal as well as business plans?

Within the financial services provided by First National Bank, customers can resort to funds for their businesses, If you feel you need some kind of guidance such as business proposals and plans, you can definitely contact the customer service department. For sure, they will be able to help you with assistance, support and resources. 

We have a business account with FNB, which has had an average of R52,000 income per month. How much revolving credit can we expect?

You will need to provide more information as regards your business if you are looking to obtain a revolving loan with FNB. The minimum amount of money you can ask is around 20,000 rand. The bank will analyse your situation and determine how much you can obtain based on a monthly income of 52,000 rand.

Why can you not get a business loan from FNB to buy stock for your business?

If you are unable to obtain a business loan with First National Bank to buy stock for your business, there might be some problems with the qualifications criteria. You should contact the bank directly and ask about your options to borrow money. Consider that the requirements include a good credit history, proof of income or business revenue. 

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