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Has Your Business Funding Application Been Approved?

If you’ve recently applied for business funding, you might be wondering — what happens now?

Congrats to those approved. If your application was declined, you're not alone, and you're not out of options. In this issue, we unpack why some applications fall short, how to improve next time, and where to find the funding insights you need.

Why Some Applications Were Not Successful

We know a rejection can be discouraging, but it's not the end of your funding journey—it's a starting point for growth. Your application was reviewed against the criteria of our private lenders, who specialise in providing short-term loans outside of traditional banks.

The feedback from your recent application likely highlighted two key areas: Concentration Risk and not meeting the minimum transactional requirements (DNQ).

1. Concentration Risk: This means your business relies heavily on a single customer, supplier, or product. While having a strong client is great, lenders see this as a significant risk. If that one relationship ends, the business's stability is at risk.
2. Minimum Transactional Activity (DNQ): Lenders use metrics like a minimum number of EFT credits into your business account (in this case, 15 per month) to assess business health and activity. It's a key indicator of consistent cash flow and a diversified customer base.

This feedback isn't a dead end. It's a clear roadmap for what you need to improve to get approved next time.

What You Can Do Next

• Actively seek out new clients to reduce your reliance on one major source of income.
• Focus on getting more EFT payments into your business account. Even small, frequent transactions from multiple customers are a positive signal to lenders.
• Maintain a healthy turnover of at least R50,000 per month. If you can consistently demonstrate these improvements over the next 2-3 months, we encourage you to reapply.

No matter where you are in your funding journey, we’ve created expert resources to help you get closer to your funding goals:

At SME South Africa, we're more than just a Resource Platform for Small Business Owners; we're your partner in building a stronger, more fundable business.

What best describes your most recent application for business funding? I was approved and received funding I was declined and received feedback Still waiting to hear back I haven’t applied yet, but I’m interested

Your funding journey is unique, and every step forward is a step closer to the capital you need. Whether you're rebuilding for the next round or growing with newly acquired funds, we’re here to support you at every stage.