1. Would I be able to get financing if i am going into a business for the first time or if there is no collateral or more worse, if my existing loan has been classified as non-performing loan (NPL)?
2. Where can i get financial advisory services relating to my business needs?
3. Where can I lodge a complaint against my financial institution?
4. What kind of equipment will I need?
5. How can I better my chances of success?
6. What is a business plan and why do I need one?
7. How much money do I need to get started?
8. How do I go about financing a business?
9. How do I apply for a loan?
10. What do I do if my loan request is rejected?
11. Should I start a business in my home, or in a rented office space?
12. What are the reasons for a financial institution to reject a loan application?

Would I be able to get financing if i am going into a business for the first time or if there is no collateral or more worse, if my existing loan has been classified as non-performing loan (NPL)?

Yes, nothing is impossible. To find out more, contact a SME business facility solutions near you.

Where can i get financial advisory services relating to my business needs?

Small and Medium Enterprise (SME) Unit at SME business facility solutions that provides financial solutions and advisory services to small and medium enterprises.

Where can I lodge a complaint against my financial institution?

All commercial banks and finance companies have been required by Bank Negara Malaysia to establish a complaints unit within their respective institution. You should first try to resolve your complaint with your financial institution. However, if you are still not satisfied with the reply, you can refer your problem to Bank Negara Malaysia. For matters relating to Bumiputera business loans, you can also refer your problem to ERF Sdn. Bhd. (a special-purpose vehicle established by Bank Negara Malaysia to undertake the role of a one-stop centre on Bumiputera financing issues).

What kind of equipment will I need?

Again, this will depend on the nature of your business. Some office equipment found in small businesses includes:

• Computer
• Printer (many prefer laser printers for the professional image they create for marketing materials, etc.)
• Fax machine
• Separate telephone line for business number with voice mail
• Separate telephone line for fax number
• Internet connection (including e-mail and web browsing capabilities)
• Photocopier

You might consider investing in a multi-function machine that combines a printer, fax, scanner, and copier in one unit. If you require other specialized equipment or tools, you'll want to be sure to include these purchases in your budget when you're planning your business.

To find out more, contact a SME business facility solutions near you.

How can I better my chances of success?

• Don't be too timid – or too proud – to ask for help. Network with other established small business owners to find out how they handle similar situations.

• Don't underestimate your financial needs, particularly cash flow. Have a solid understanding of the best and worst-case scenarios for your company, and have a plan in place on how to handle both.

• Remember that marketing your business is an ongoing activity.

What is a business plan and why do I need one?

A business plan is a document that clearly defines your business and identifies your goals. The typical business plan includes a current balance sheet and projected financial performance, an income statement and a cash flow analysis. A solid business plan will help you allocate resources properly, handle unforeseen complications, and plan for growth. If you need to go to the bank for a loan, a business plan will provide specific and organized information about your company and how you will repay the money.

For tips on writing a business plan along with sample plans, contact a SME business facility solutions near you.

How much money do I need to get started?

This depends on the kind of business you wish to start. Do you have special equipment needs? Will you be working at home, or will you require a separate space? Will you need to hire employees right from the start? These are some of the questions you'll need to ask yourself, many of which you can answer with your business plan.

Once you have taken care of your building and equipment needs you also must have enough money on hand to cover operating expenses for at least a year. These expenses include your salary as the owner and money to repay any loans you might have.

How do I go about financing a business?

The majority of small businesses are started with personal funds from savings, a company buy-out/retirement lump sum, or a loan from family members. Some people take part-time jobs so that they'll have a steady source of income while their business gets going. If your needs are greater, SME business facility solutions offers several financing solutions to help you establish and grow your business.

How do I apply for a loan?

When you go to  SME business facility solutions about a loan, you'll more than likely be asked to fill up the forms :-

• Form S1

• Form S2

• Form S3

Some of the things the bank may look for in evaluating your application include:

• Your personal and business credit record or credit rating

• Your managerial skills, background and experience

• Your ability to repay your loan based on cash flow projections

• The long-term prospects for your particular industry

The Small Medium Industry scheme (SMI / SME), Credit Guarantee Corporation (CGC) Business Financing Loan schemes, Financial Assistance by Government Ministry & Agency are the funds offered through the Local Bank and Development Financial Institutions (DFIs) in financing to help micro, small and medium businesses get grow. This loan is a competitively priced business improvement loan designed to provide businesses, such as grow-ups with limited equity and collateral. To find out more about this particular loan and whether you might qualify, contact a SME business facility solutions near you.

What do I do if my loan request is rejected?

First and foremost, don't despair. If you are turned down for a business loan, it is likely for one of the following reasons:

• Evidence record of NPL, Bankruptcy, BMC on your personal and/or business credit history

• Your business, or the industry your business is in, appears too risky or unpredictable ( non favorable industries).

• Not enough security for the loan

• Incomplete business plan

• Insufficient cash flow to ensure regular repayment of the loan

Should I start a business in my home, or in a rented office space?

Many small business owners start their businesses from their homes because they offer low-cost office space, as well as giving you the freedom and flexibility to work the hours you want. Whether you choose to do this or not depends on how suited your business is to a home environment. For instance, if you're operating dangerous equipment or doing things that conflict with residential zoning laws, you'll have to locate your business elsewhere.

Other small businesses make their home in low-cost shared office complexes. Others swap space for bartered services. If it suits the nature of your business, you can go completely “virtual” and have no office space at all – just a laptop and telephone access and you're all set.

What are the reasons for a financial institution to reject a loan application?

Common grounds for declining credit applications include:

• Applicant does not have ability to repay the facilities applied for
• Purpose of borrowing not in line with facilities applied for
• Unsatisfactory financial results of the applicant
• Applicant has other substantial borrowings resulting in high gearing (i.e. amount of loan is higher than capital)
• Unsatisfactory conduct of current account by the applicant
• Unsatisfactory repayment records with other lenders
• Applicant has cases which are pending legal action
• High business risk such as over dependence on single buyer or supplier
• Lack of financial commitments from business owners (i.e. not willing to commit additional working capital)
• Weak management of the applicant
• Sole proprietor/partners/directors/shareholders/guarantors etc. facing  bankruptcy actions from other parties

It is a requirement by Bank Negara Malaysia that financial institutions should inform the borrowers formally in writing, clearly identifying the areas in which the borrower failed to satisfy. This will ensure that the borrowers are aware of the reasons for the rejection as well as assist the borrower to improve in the areas concerned for future loan applications.