Applying for Bank Finance - Your Proposal

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Whether your business is new, well-established, or embarking on growth or diversification, AIB has the financial products you need. We are ready to provide bank finance for a sound and viable business with a well-presented proposal, based on solid appraisal of the business and its future prospects. To access bank finance, your business must be able to generate sufficient funds to service interest and proposed loan repayments, while continuing to provide an adequate return to you and/or your business partners. Because bank finance is an investment in the future, you will also need to show that your business can survive the medium-to-long term. And of course, AIB needs to know that the business owners and managers have the skills and commitment to deliver the projected business results. These key points will be covered in the application process, where, depending on your requirements, we will seek some or all of the following information:

1. Background

Give background details on your business, including business activity, ownership, management team, history and location. You should also include information on the key stakeholders - customers, suppliers, competitors etc.

2. Purpose & Vision

Explain how credit finance will help your business. Outline past achievements and provide clear future objectives for your business, both short term and long term.

3. Risks

Show how you understand the risks that affect your business, and outline the steps your business takes to reduce/mitigate these risks. It's important to address both internal risks (relating to your product, service and business operations) and external risks (competition, market changes etc.)

4. Financial Information

Provide historical financial information in the form of audited accounts and, where appropriate, the following types of information:

• Management accounts for the current year.
• Cashflow Forecast for the next 3 years, and details of the supporting assumptions (the Cashflow Planning tool on www.aib.ie/business may be helpful here)
• Breakeven Analysis
• Aged list of Debtors/Creditors
• Confirmation from the Revenue Commissioners that all your personal and business tax affairs are in order
• Total assets/liabilities (personal and business)
• Other information relevant to your particular industry/business.

If yours is a new business, you will also need to provide:

• Forecast Trading Profit and Loss Accounts for the next 3 years
• 12 months of any previous business and/or personal bank statements
• Business Plan (ideally prepared with your accountant).

5. Business Plan Document

Your Business Plan is how you will present your business to various important stakeholders, as well as to AIB, when you seek bank finance. It should include relevant information outlined above, laid out clearly and concisely. We do recommend that you seek professional advice from your accountant and/or Solicitor when writing your Business Plan.

You can also seek the support of various business organisations and state agencies - Chamber of Commerce, ISME, SFA, Enterprise Ireland and your local Enterprise Board - that can offer useful advice and information.

A good starting point is our Business Plan template.

6. Financial Requirements

Set out exactly what you need from AIB, including the amount and purpose of the borrowing. If you're looking to borrow part of the cost of a project, do include the total cost and details on how you will fund the balance. It is important to outline the steps you took to determine the right level of borrowing, which should allow for unexpected expenses and be supported by a budget in line with your Business Plan.

7. Repayment

It is critical to demonstrate how your business will repay the finance facility. Be clear about the source of repayment and include potential alternatives in the event of the expected source failing. Your budget and cashflow forecasts should reflect realistic business expectations for the period of the facility.

8. Security

Provide details of any security you are offering to support your application - for example assets, a personal guarantee, Letter of Pledge or Letter of Lien. Irrespective of any security you may provide, though, the lending decision will be based on the capacity of the business to repay the finance.

Chapter 3 - Finding the Right Lending Product for Your Business >>>

Imprtant Regulatory Information

AIB Insurance Services Ltd is regulated by the Central Bank of Ireland.

Credit Facilities

Lending criteria, terms and conditions apply. Credit facilities are subject to repayment capacity and financial status and are not available to persons under 18 years of age. Security may be required.

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