Corporate credits
Request a corporate creditCorporate credit for small and medium enterprises
Crediting of small and medium-sized enterprises applies to all duly registered private companies or self-employed persons. Whether the credit is corporate or not is determined by the source of income, ie. when the source is the legal entity, the credit is corporate. There are cases where consumer credits are offered to company owners who are reapplying with company earnings. Whether a company or a group of related parties (a group of related companies) falls into that segment most banks determine according to:
- The amount of the requested credit
- Annual turnover
Credits to small and medium-sized enterprises may be unsecured and secured. Most often collateral is real estate, a pledge of assets, goods and other. The credit is released after analysis of the company.
Types of credit according to the financial needs
Business credits – Short-term credits intended for:
- Increasing the short-term capital of enterprises and expanding their business.
- Stocking raw materials due to expected price growth.
- Holding the realization of the finished product due to the expected increase in price.
- Financing of investments in short-term revaluation assets.
Turnover credits are provided in different forms, most often:
- Standard credit for working capital
- Revolving credit
- Overdraft
They are either secured or unsecured, depending on the client’s profile and the size of the desired amount.
Investment credits – long-term credits
- Used to finance investment goals:
- Purchase of equipment, machinery, buildings, land, vehicles, etc.
- Construction, СAW, improvements, new technologies
- Offered at once or in tranches
- The term is based on the usual return and depreciation of the investment
- A grace period is provided if necessary
- A possibility of a seasonal repayment scheme when the company’s activity is related to seasonality – agriculture, tourism and others.
Specialized corporate credits
For a start-up business – another company guarantor is required to have a business history and meet the requirements of the creditor bank.
Agro credits – intended for the purchase of land and/or agricultural machinery.
Overdraft in return of subsidies from the State Agriculture Fund
Personal needs of business owners:
- Unsecured credits – to cover the person’s education, the needs of the company’s owner (purchase of equipment, automobile, education, etc.)
- Secured credits – for the purchase of a property for personal use.
Credits for medical persons:
- Investment credits for doctors and dentists
- Overdraft – based on income from the NHIF
Energy efficiency for small and medium enterprises
Financing under guarantee agreements
Banks offer credits with guarantees from the European Investment Fund, which help enterprises under the InnovFin, COSME and SME Initiative programs, as well as credits with guarantees from the NGF.
- Financing under EU Operational Programs 2014-2020
Specialized projects for targeted financing of investment costs related to the implementation of approved projects under the Operational Programs of the European Union for the period 2014-2020, feasibility and post-project financing as well as additional credits for the financing of the VAT expenditures.
https://www.eufunds.bg/programen-period-2014-2020/operativni-programi-2014-2020
- Guarantee Agreement NGFs – credit products of micro-enterprises and freelancers under joint programs with the National Guarantee Fund (NGF) of the Bulgarian Development Bank.
http://www.ngf.bg/bg/guarantee_schemes/ngf-2017-2018
- InnovFin Guarantee Agreement
The project is aimed at financing the activity of enterprises with reduced collateral requirements and at attractive price conditions. To this end, the European Investment Fund provides a portfolio guarantee for credit risk
- COSME Guarantee Agreement
The Portfolio Guarantee provided by the European Investment Fund finances the activity of small and medium-sized enterprises with reduced collateral requirements and attractive price conditions.
- SME Initiative Guarantee Agreement
Thanks to the portfolio guarantee provided by the European Investment Fund, the activity of small and medium-sized enterprises is funded with reduced collateral requirements and attractive price conditions.
When deciding on business credit, it is extremely important to correctly determine the purpose of the credit and the most appropriate product to the needs of the firm.
Turnover credits are spent on short-term current purposes and investment are spend for long-term purposes. It is not justified to buy a long-term asset with an overdraft or to mortgage a real estate for the purchase of raw materials or commodities.
Creditchoice credit consultants will direct you to the most appropriate product and will contact you with creditors for Small and Medium Businesses. We’ll let you know which bank institutions offer the products most suited to your needs.
