Dealing with your banker and other lenders
Approaching a bank or other private lenders for a loan can be a complex process, but knowing what bankers are looking for can help you successfully secure financing.
Be prepared
Do your research before you meet with your banker. Do not just explain what a great idea you have — explain why it can be successful, and, most importantly, how you are going to make it successful. Your banker will want to see that a business opportunity exists and that you have the skills needed to manage the project.
Banks usually require a business plan, a risk assessment, and a detailed financial history. You will need to demonstrate to your banker that an investment in your business makes good financial sense, so taking the time to create a persuasive proposal is essential.
- How to get a business loan
Get tips on applying for a loan — what to include in your proposal, what bankers look for, common terms, and more. - Business planning
Find out how to write a business plan and access templates, sample business plans, market research information and statistics. - BDC Business loan calculator
Calculate how much a loan will cost your business, and print a complete loan amortization schedule.
Risk assessment
Your banker will also want to see a comprehensive risk assessment. Be ready to discuss how you plan to take care of obstacles that could threaten your chances of success. To learn more about planning for contingencies, see our section on risk management.
- Risk management
Identify the risks your business may face and learn to set up an effective risk management program to maximize your chances of success.
Financial history
Your banker will require information about your business' financial history. If you are starting up and your business does not have a financial history, they will likely require information about your personal credit history. Be prepared to show what you have to guarantee the loan. What are you using as collateral? Do you have any guarantors? Are there any other investors?
Failure can lead to success
If your application is turned down, ask your banker to review it with you to find out why. Use this information to improve your presentation the next time.
For more information on working with a private lender, see the Canadian Bankers Association's Code of Conduct. Our Private Sector Financing section outlines the types of financing available and our Sources of Private Sector Financing page can help you connect with lenders.
- Small Business Banking Code of Conduct
Learn about the model code of conduct that Canadian chartered banks strive for in their relations with small and medium-sized businesses. - Small business: Your rights and responsibilities
Find out how to file a complaint against a financial institution that has violated its code of conduct when dealing with your business. - Private sector financing
Your business may be eligible for different types of private sector financing, including debt and equity. - Sources of private sector financing
Find out about the debt and equity financing available from the private sector for your business needs. - Government grants and financing
Find out about government grants, loans, and other financing available for your business. - Financing from non-government organizations
There may be not-for-profit or community-based organizations that can offer you financing or direct you towards financing.
