Business Developments for Loans in South Africa

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Business Developments for Loans in South Africa are key to securing government funding or private investment and DTC can assist with these!

Business developments


The following documents are important for business developments for loans in South Africa:

  1. Company Registration or Co-operative Registration, with a Memorandum of Incorporation;
  2. Close Corporations can no longer be registered as of 1 May 2011, but are still valid juristic persons. Close Corporations have the option of converting to (Pty) Ltd;
  3. Business Plans (for start-up businesses, businesses looking to expand, or going concerns);
  4. Financial Forecasts (for start-up businesses, businesses looking to expand, or going concerns);
  5. Financial Plans (for start-up businesses, businesses looking to expand, or going concerns);
  6. Due Diligence Reports (for going concerns);
  7. Feasibility Studies (required for projects in the amount of R5 million and above);
  8. Tax Clearance Registrations;
  9. Central Supplier Distribution (for businesses looking to secure tenders from all branches of government);
  10. Broad-Based Black Economic Empowerment (BBBEE) Certificates; and
  11. Franchise Agreements, Disclosure Documents, and Franchise Manuals (for businesses seeking to franchise).

Business developments

Factors that influence business loan approval:

A healthy credit score/history:

The most basic and obvious factor for a successful loan application is a high credit score. Financial experts suggest that it is essential for a business owner to keep the personal credit score as high as possible. When it comes to small business loans, financial institutions take into consideration the personal credit score of the business owner.

The borrowers with a credit score of 720 or higher get better interest rates. Alternate lenders or Nonbank financial companies (NBFCs) try to fill in the void created by financial institutions by providing new business loans to borrowers with a credit score as low as 500. Hence, small business owners with low credit scores prefer private NBFCs for ease and speed of funding.

However, good credit history is always a prerequisite for easing out the approval of new business loans. Timely payment of dues, transparent transactions, invoicing of every purchase with dealers are something that can help you build a good credit history.  

Age of business:

Occasionally, banks and NBFCs see the age of business, cash flow, statement of transactions, and other factors in approving your business loan. For small business owners, the annual percentage rate is usually higher.

Once your financial partners can see some traction in your business, they will follow up with better interest rates. However, many private lenders specifically provide small business loans. All you have to do is to gauge your requirements using a business loan calculator.


Financial institutions reduce lending risk by asking small business owners to use their assets as collateral to secure the business loan. Lenders allow small businesses to use their stock, equipment, and similar business assets as collateral. Alternatively, institutions like NBFCs offer collateral-free small business loans as well.   

Type of business:

The type of business plays an impending factor in your loan application. If your financial partner considers your kind of business to be risky, then things may get slower, with financial institutions charging higher interest. Complete market research about the potential of your business can be used to convince your banking or NBFC partner to believe in your vision.  

Business plan:

If you are a new business owner who would like to get started or an existing business owner who wants to expand the organisation, you need a plan in place to show to the banks or NBFCs. If the business plan is impressive enough, then the following process is typically faster. You need to explain the purpose of the loan, vision, and other factors to structure your business plan well.   


Contact us – for assistance with Business Developments for Loans in South Africa.

Business developments for Loans in South Africa