Where it fits
Start by separating the amount, drawdown date and funding job. For a defined investment or cash-flow gap, compare a relationship bank, another bank and a specialist route using the same assumptions.
What lenders will test
Build the file around bank conduct, accounts, tax records and the repayment source. Reconcile reported sales to bank deposits and explain one-off movements before a lender asks.
Price the cash flows
Ask for net proceeds after fees, every repayment date, the reference rate and margin, default pricing, mandatory insurance, guarantee cost and settlement figures after 6, 12 and 24 months.
Failure case
Stress test using long-term debt to hide an unresolved monthly loss. Run revenue 15% lower, collections 30 days later and the reference rate two percentage points higher.
Start with the cash event, not a product name
A Hong Kong SME can use an instalment loan, overdraft, revolving line, trade facility, receivables finance or asset-backed borrowing for working capital. Those labels describe different cash-flow mechanics. A fixed instalment belongs behind a project with a measurable payback period, while a trade or revolving facility should rise and fall with stock, shipments or collections.
Write a one-page borrowing brief before contacting providers. State the amount, exact use, drawdown date, repayment source, preferred term and security available. Split a mixed request where necessary. Equipment that works for five years and inventory that clears in ninety days should rarely sit inside the same repayment schedule.
Build a three-route comparison
Use one established relationship bank, one credible alternative bank or virtual bank, and one specialist whose structure matches the transaction. Major-bank unsecured limits vary sharply: current public examples range from HK$1.5 million at HSBC to HK$7.8 million at Standard Chartered, subject to each lender's conditions and assessment.
The active 80% SFGS can support facilities up to HK$18 million for as long as ten years, but the guarantee protects the participating lender rather than the borrower. It does not promise approval, remove personal guarantees or make a weak cash-flow case affordable.
- What cash reaches the company after every fee and deduction?
- Which reference rate, margin, floor and reset date control the interest charge?
- What happens to guarantees, security and fees after early settlement?
Decide with a downside case
Model at least thirteen weeks of cash, then run sales 15% lower, collections 30 days later and the floating reference rate two percentage points higher. A loan that works only when every assumption lands on time leaves no room for normal trading volatility.
Approval is not the decision point. The decision comes after the company can explain why the facility creates more cash than it consumes, who carries personal liability, and how the business exits the debt if the original plan changes.
Rates, limits and eligibility can change. Ask for a current written quote, repayment schedule and agreement. General information only.