This startup provides male grooming services and products in high traffic shopping malls.
The founder was keen to ride the growing wave of demand for convenient, high-quality barbering services and establish a loyal client base in new areas before the competition. .
The founder wanted to consolidate several high-cost, short-term loans and get additional funding to buy stock and continue opening new kiosks.
He already had three short-term loans in place totalling £65k. The annual interest rates were around 37% and monthly repayments were over £6k.
We initially reached out to Community Development Finance Institutions (CDFIs). Unfortunately, the small financial benefit of working with a CDFI quickly became heavily outweighed by the time it would take to provide all the required financial information.
As a faster alternative, we approached a different lender with which we have a long history of working. This relationship meant that when we faced a further setback - the request for £100k was rejected - we were able to get feedback: the underwriters wern't happy with affordability and the lack of homeownership. .
The Risecap team presented evidence that the loan was affordable by revisiting some nuances and calculated the new debt service cover. We also convinced the lender to reduce their fee. This opened up a loan offer of £75k, which would consolidate the existing high-cost loans, provide some immediate funds, and save over £4k on repayments every month.
Next, we worked with the client to assess whether this alternative would meet their business needs, and found that it would.
The final loan amount was for £75k at 17.4% over 60 months, with monthly repayments around £2k.
25 Green Street, Mayfair, London, W1K 7AX
Risecap Ltd (Company no. 11203916) Data Protection Number ZA553906. The registered address is 1st Floor, 8-12 London Street, Southport, PR9 0UE, United Kingdom.
Risecap is a credit broker and not a lender. We will receive commission from lenders. Different lenders pay different amounts depending on different commission models. For transparency we work with the following commission models: fixed fee, fixed rate of commission, percentage of the amount you borrow. In some circumstances, we do not receive any commission or fee from the lender, we will detail the commission or fee scenario throughout your customer journey
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25 Green Street London W1K 7AX
Risecap Ltd Data Protection Number ZA553906. The registered address is 85 Great Portland Street, London, England, W1W 7LT. Risecap is a credit broker and not a lender.
Copyright © 2022 Risecap. All rights reserved.
