The past is often a good indicator of the future. Lenders will want to know about your business history, as it will give them insight into where your business is headed.
Factors that a lender will want to consider are:
Age
- The length of time that your business has been operating for
- If your business has been around for a while, then this is a good indication of business success to date
- This can also demonstrate the consistency of your operations and is a sign of future success
Industry
- The industry that your business is in (retail, manufacturing, etc.)
- This can indicate the level of risk associated with your business – some business lenders will also prefer to lend to particular industries based on their current lending portfolio
- It also makes it easier to identify if your business is in a growth industry, or one in decline
Principles / Directors
- The level of experience you have running your business
- How you have conducted your business to date
- This demonstrates your competence, and business stability
How does this relate to my application?
The less risk that a lender can identify from your application, the more confident they will be in lending to you. If you can show that your business has grown and performed well in the past, then that correlates to a lower level of risk.