For over 15 years now, Genfin has been providing South African companies with business loans to further their businesses growth.
Finance available between R100 000 and R2 million. Thriving companies from across all industries in South Africa can apply. Genfin requirements are strict in terms of applicant’s trading reputation.
- An annual turnover of more than R1 milliom
- A trading history of at least 12 months
- A registered company or close corporation in South Africa
How it works
You can either:
- Apply online by filling in the application form, electronically submitting your recent bank statements and other requested documents. Or
- Call Genfin for telephonic application. They have consultants who will help you complete your application over the phone.
Once the application process has been complete, a consultant is allocated to assist you through out the loan period. Should you need any further funding; the allocated consultant will be there to assist you, even after the end of the current loan term.
It takes an average of 3 days to receive the funds after loan approval and having had sent through all the requested supporting documents.
To come up with an offer Genfin requires you to provide 12 months bank statements. However, depending on the loan value, latest financial statements, management accounts and SARS statements of account may also be requested.
How does Genfin evaluate the application?
Genfin does not have a specific fomula of evaluating applications. However they take three factors into account when coming up with a decision:
1. Business Stability
Generally, all lenders want to be associated with stable businesses. To determine the stability of a business, lenders check if you are likely able to withstand a temporary problem, such as a decrease in sales, lack of capital even the loss of a key customer.
To check your business’ financial stability, you will have to analyze your cash flow and some negative scenarios that might affect your cash flow.
2. Financial Metrics
Financial metrics are the key numbers that you can focus on in financial statements. Genfin will evaluate your financial statements;
- the balance sheet, to see how liquid is the company
- the income statement, to see the growth rate of your net income and the earnings of a company
- whereas the cash flow statements will help them see the actual money being made by the company and how its spent.
3. Credit History
To see how your business has been dealing with its creditors. This will determine if your company is worth dealing with based on your past relationships with other creditors.
Repaying Genfin Loan
The Genfin standard loan repayment periods is 12 months, 9 months, 6 months and three months. However, the company can also allow you to pay the installments on a weekly basis, over 26 weeks. The shorter your repayment period the lesser interest you will pay because interest is charged on your outstanding loan balance.
Genfin charges an interest rate of 3.5% on the outstanding balance of your loan every month. Therefore the interest paid reduces as the outstanding balance goes down.
There are no application fees, hidden costs or any additional costs charged to facilitate the loan.
After repaying 50% of your loan, there is an option of refinancing which will automatically extend the term of the loan.
Genfin business loan Competitive Advantage
Genfin has transparent prices and doesn’t charge for origination costs or any facilitating costs as other traditional lenders do. Also, the 3.5% pm interest is charged on the reducing balance of your business loan, making it less costly than other lenders.
2. No early settlement fees
Unlike some banks and traditional lenders, Genfin allows you to pay off your loan earlier without any penalties. otherwise, paying off your loan early tends to reduce the total cost of borrowing.
3. No Restriction on use of funds
You are not restricted on how to use the loan funds, weather you are making equipment purchase or meeting other financial commitments, it’s all up to you.
Other lenders would limit you to use the funds only on the agreed specific purpose.
4. You can get additional funds during the term of your loan
Once 50% of your capital has been repaid, you can access further funds by redrawing excess repaid loan facility at any time.
5. Free application
Traditional lenders would charge you an application fee (origination fees) which usually varies from 3% to 10% of a given loan amount. With Genfin you get to save on these fees costs, also there are no other hidden fees.
Genfin Business Loan Competitive Disadvantages
1. Strict requirements
Genfin business loans only cater to a few businesses that are already performing well.
Most South African small businesses are not making over R1 million per annum, requesting a turnover of more than a million is automatically taking out a lot of businesses from applying.
Small businesses have a challenging maintaining an appealing cash flow for the all year.
With inconsistencies in the small business environment, even well-performing businesses have cash flow flaws.
The Genfin business loans do not consider startups; they only fund companies who have been trading for more than a year. Unlike business loans offered by traditional banks such as Absa’s business loans.
2. Short loan terms
12 months loan term may be too short, especially if the project being financed takes time to yield returns.
3. Long application process
For pressing situations, 3 days may be too long to wait for a loan to be financed. Of late, online lenders can deposit the funds of a loan within 24 hours when approved.
Genfin is a viable place to get a loan for your business if it qualifies. It offers many convenient services for its clients such as offering a loan to your business regardless of you having a loan not fully paid prior
Along with its competitors such as Business Partners and Lulaland, Genfin is growing in the Fintechs lending Industry at a relatively fast way.
Don’t forget to check out our Best Personal Loans for 2020