Updated 16.02.2022

FNB Business Loans

Opening a new business is an exciting chapter in life. However, getting finance might not be that exciting. Fortunately, FNB business loans help financially aid new businesses. In this article, we take a close look at what you need to know. We will discuss various topics, including the application process and loan terms.

FNB Business loans overview

  • Flexible terms
  • Set interest rate
  • Pay less interest over time
  • Automatic payments
  • Loan security option
  • Minimum loan of R2000
  • Maximum loan of R400, 000
  • Minimum repayment period of 3 months
  • Maximum repayment period of 60 months

What is the purpose of the FNB Business loan?

The purpose of this type of loan is to help SME businesses. FNB understands that new businesses need capital to operate. Therefore, they offer businesses financial aid through loans. These loans can be used to help start all operations and gain capital. Furthermore, FNB loans allow businesses to grow and succeed.

Businesses can get a minimum business loan of R2000

How it works

FNB clients can apply for a loan online at www.fnb.co.za or at an FNB branch. Furthermore, clients will receive flexible repayment terms. Clients can repay the loan over 3 months or 5 years. FNB offers a minimum loan amount of R2000.

Additionally, clients do not need to provide surety if the loan is less than R400, 000. However, security will be required if the loan is above the maximum amount. Clients can also enjoy the automatic payment option. This ensures that clients do not skip or miss any repayments.

Lastly, FNB will review each client’s credit profile. This will help determine a set interest rate, allowing clients to budget and plan.

FNB business loan application

The loan application is pretty simple. Clients can apply for an FNB business loan by:

  1. Completing  the “Call me back” form online
  2. Visiting a FNB branch
  3. Applying via the FNB banking app.

Documents required

Businesses applying for a loan under R400, 000 will not need to submit supporting documents. Furthermore, they will not require any collateral.

However businesses applying for loans above R400, 000 will need to submit the following:

  • Cash flow statements
  • Income statements
  • Balance sheets
  • Annual financial statements
  • Year-to-date management accounts
  • A business finance application form

You will need to submit the following if you do not have an FNB business account

  • 6 months bank statement
  • A business plan with all the business details
  • Projections of the business
  • Additional financial information
  • Clients may be asked to open an FNB business account

Qualifying criteria

Clients will need to meet a few criteria if they’re interested in getting an FNB business loan.

  • Have an active FNB business account that is well standing
  • Meet additional credit criteria i.e. have a good credit history
  • Have an annual turnover of R500, 000
  • The business should be operating for over 15 months

Repayment terms

FNB offers its clients rather flexible terms. The loan repayment period varies from 3 months to 60 months. Furthermore, the interest rate charged is fully risk related and negotiable. Clients will also need to pay a 1% application fee.

The loan is usually paid off through monthly debit orders from the business account. The installment amount is fixed. Therefore, allowing clients to plan and budget each month.

Advantages of FNB business loans

There are plenty of advantages to taking out a business loan. Here are some of the advantages.

Loans help provide start-up capital

Start-up capital is crucial for any business to start trading. Furthermore, start-up capital ensures that the business will have sufficient cash flow. The cash flow helps businesses produce and manufacture products. As a result, businesses will be able to trade and start making a profit.

Helps start-ups expand

FNB start-up business loans allow businesses the opportunity to expand. This is done by assisting businesses to expand into new market places. However, it’s absolutely vital that businesses manage their funds correctly.

Allows for flexibility

Taking out a loan is better than borrowing money from an investor. Usually, investors will want a say in the start-up business. However, taking a loan gives the owner complete flexibility.

Easy application

Existing FNB clients can enjoy the easy application process. All they need to do is apply online or through the app for an instant business loan. A massive perk to this loan is that clients do not need to submit any documentation.

No collateral

Most loans require clients to sign off some form of collateral. However, the FNB business loan gives clients peace of mind. Clients can effortlessly apply for a loan without providing any form of collateral.

Fixed monthly repayment

FNB offers clients a fixed monthly repayment. Therefore, clients know exactly what they will be paying each month. In addition, FNB also sets up automatic payments for the business account. This helps ensure that payments are made each month on time.

Fixed interest rate

Clients can enjoy a fixed interest rate without having to worry about rising interest rates. This allows businesses to plan each payment every month.

Disadvantages of FNB Business loans

Let’s discuss some of the disadvantages of an FNB business loan.

Business operation period

Businesses need to be fully operational for 15 months before they can apply for a loan. This might be an issue if the business is relatively new and requires a loan. Furthermore, credit profiling limits businesses from attaining capital.

Admin fees

Clients who take out an FNB business loan need to pay a 1% admin fee. This percentage is fully determined by the loan amount. The once-off admin fee is deducted as soon as the loan is paid out.

The bottom line

FNB business loans are a great option for those looking for financial aid. Furthermore, clients can enjoy multiple benefits. This includes no collateral, fixed repayments, and fixed interest rates. The application process is quick and easy, allowing clients instant access to a loan.

Unfortunately, this loan is mostly limited to FNB business clients. Clients will also need to pay a 1% administration fee before receiving the loan.