Business Partners business loans have been of effective financial assistance to a number of South African entrepreneurs over the years.

Business Partners is a South African financial service provider with an excellent reputation.

To date, they have provided South African SMEs with business loans worth over R19.5 billion.

All business owners with a viable formal business can access financial assistance in loans of R500 000 up to R50 million.

However, the funds received from Business Partners have spending restrictions.

A company can spend their funds for expansion, working capital, equipment, takeovers, property, franchises, management buy-outs, and so on.

Eligible applicants:

• businesses with gross assets less than R100 million
• Annual turnover that is not more than R200 million
• Less than 500 employees
• All sectors of the economy except for on-lending activities, direct farming operations, underground mining, informal and micro enterprises and non-profit organizations.
• Reputable business owners

Application process

The applications can either be done online or from any of the Business Partners’ branches nationwide.

You can fill out and submit an ‘enquirer about finance’ form on their website, providing them with the requested information about your business, its owner, and the desired loan amount.

Business Partners will then use this information to determine whether you can proceed with the application or if you should look elsewhere.

Should you proceed to the application phase, you will need to submit the application form and a business plan. The application form can either be emailed to them or dropped off at their branch.

Your business plan will provide them with detailed information about your business, the management team; the activities of the business and the market in which it operates, projections, and the financing requirements.

Below we have laid out some of the essential information your business plan should point out:

• The breakdown of what needs to be financed
• The owner’s contribution
• Latest financials and SMART projections that present your business as a going concern
• Evidence of regulatory compliance, from up-to-date taxes to business permits/ license
• A single document, comprising all elements and key factors mentioned in the business plan

Also, the application will be assessed by looking at the business owner’s personal profile(s);

• His/her ability to run a successful business on sound business principles
• Personal principles such as integrity, drive and vision
• Their skills and appropriate experience in the industry concerned

How to use the Business Partners loans received

The funds received from Business Partners are meant to be spent on:

• Purchase of equipment
• Expansion
• Management buyouts
• Property finance for owner-occupied businesses
• Startups
• Takeovers
• Working capital and revamps

Terms of repayment

Business Partners offers long-term loans from 3 to 5 years for business finance, whereas property finance goes up to 10 years.

Property Funds

Business owners with a viable business who want to purchase their own premises may get funding from Business Partners. The loan amounts start from R500 000 to R50 million and can be paid off in 10 years.

Considered applications are those of:

• Businesses that occupy at least 50% of the property in question
• The businesses with a sound financial track record
• Must be viable and have been in existence for no less than two years

The property to be purchased is expected to be in good condition, well located and priced at reasonable market value.

Business Partners does not assist with funds for residential and agriculture properties.

Competitive advantages of Business Partners loans

Long repayment period

Business Partners have long repayment periods of 3 to 5 years. This tends to lower the number of monthly instalments. Also, renegotiating the financing conditions, either in the repayment term or in the interest of the loan, may be feasible in a long-term loan.

Expertise

Since 1981, Business Partners has been assisting small and medium enterprises in South Africa with investments and loans. Therefore, they have in-depth knowledge of the SME sector, as well as insight into the opportunities available to and challenges facing independent businesses.

Funds for Start-up businesses

Most lenders do not want to assist start-up businesses. While Business partners open their hands to assist startups, all you need is a good and feasible business plan that meets their standards. Their mentorship services also set them apart from other lenders.

Value-added services

Business Partners has about 300 mentors, who can assist in a range of services available to clients, potential clients and the public. Some examples of the type of assistance offered are marketing, financial management and technical assistance.

Competitive disadvantages of Business Partners Loans

Restrictions on the use of funds

Business Partners puts restrictions on the use of advanced funds.

The funds received can only be spent on items you specified on the loan application according to the requirements they give.

This becomes a limitation if you want to use the funds for other purposes, say, a business trip or other not mentioned uses.

Slow application process

The internet has made it possible for a business to apply and get funds for a loan in less than a day.

Most Fintech lenders such as Bridgement, Pollen Finance and Lulalend have simple paperless application processes on their websites. Usually, the application processes take less than 8 minutes.

Surprisingly, Business Partners still expect their clients to fill out an inquiry form before being given an application form.

This drags and slows down the application process, in these fast-moving times, no business wants to wait up just to process a loan application.

Conclusion

Business partners are definitely a go-to lender when you need to finance huge projects since their loan terms can stretch out to 5 years or even more for properties.

However, their processes are too long for urgent cases that need immediate funds to solve.