Five tips to become lender ready
23 July 2021
Due to a series of factors over the past few years, including a Royal Commission into banking, superannuation and financial services, as well as COVID-19, the lending sector has gone through a significant amount of change.
What sort of change?
For lenders, it means ensuring strict discipline in all ‘due diligence’. It means being disciplined when working with clients to manage risk. It also means they are subject to external review to ensure compliance.
For borrowers, it means discipline when putting together a loan proposition. It means developing robust and professional paperwork. It also means a strong focus on defining business risk and demonstrating that the guesswork has been taken out of your loan proposition.
A Lender Ready Program
Recognising how significant these changes were, an industry working group comprising Meat & Livestock Australia (MLA) and the Agri-Business Development Institute (ABDI), agreed that a Lender Ready Program would be developed as part of an existing MLA-ABDI Business Education Project.
The program was first rolled out in April 2021 and the next one starts on Monday 9 August.
What does this mean for red meat sector business owners?
First, life has changed significantly. Second, these changes are here to stay. Third, even more change is on the cards as lenders assess all levels of risk.
Expect future risk assessment to include social licence to operate, climate change and natural capital amongst others.
Five tips to becoming Lender Ready
Stay tuned for more detail, but in the meantime here are the 5 top tips:
- Leave plenty of time to plan and engage lenders
- Be 100% clear – clarity is the key
- Have a business plan that’s specific
- Develop comprehensive financials
- Work out which lenders to engage with
Want to become lender ready?
ABDI will be hosting an online information session to explain how The Lender Ready Program works. Head to the ABDI website now to register.