If you want to get the money from the bank to accomplish your business requirements, the first step towards getting the loan is writing a project proposal for a bank loan. When you plan a project proposal to get a loan, remember that you are writing to inform and persuade lenders. But also writing a document that can be used as a projection and guide for yourself and your business.

What Does a Project Proposal Include?

A strong project proposal for a loan application will include the following elements:

1. Cover Page and Table of Contents

The cover page should look professional, and contain the name of your business and your contact information. If you have a logo, it should go on the cover.

2. Executive summary:

The summary is written to give a complete overview of the company. Describe the company, your product, and why you started the company. Introduce your chief competitors and why your product will succeed against the competitors of the company:

3. Company Description:

The management team of the company is the major representative. The company description should include a mission statement, the company principles, and strategic partners, and your corporate structure. The banker is interested in knowing how the projects of the company are running.

4. Market Analysis

Provide a competitive analysis of your market. Identify the existing gaps that your business will fill. A business plan’s market analysis should include:

  • An industry overview and outlook
  • Any differentiation in the sector
  • Information on your target market
  • The company’s marketing strategy and how it will make your company stand out
5. Organization and Management

The description should include an organizational chart, a structure description, and salary forecasts, management position, the person in the position, their responsibilities, and their qualifications, Board of Directors.

6. Service or Product

The service or product section should include What do you sell?  Whom do you sell to? What need are you fulfilling? Also, your product/service’s estimated lifecycle, and any research and development, any trademarks, patents, if applicable.

7. Marketing and Sales

Specify your plan for customers to identify your products or services. Define what your efforts will be. Will you be on social media channels? Which ones, and why? Which types of customers?

 This section also includes information on your growth strategy.

 If you plan extensions to other geographic areas or other types of possible customers,

8. Financial data:

The financial statements and the financial forecasts for 3 to 5 years. This information enables the bank to know your ability to repay the loan. The financial projections must include:

  • Income statements
  • Cash flow statements
  • Capital expenditure budgets
  • Balance sheet
  • Break-even Analysis

A break-even analysis is the calculation and study of the margin of safety of a company.

  • Business Ratios

Projected ratios are used to assess and analyze the performance of a business. to understand your business’s potential and also serve as a goalpost for your planning.

9. Funding Request

Here’s one way you can structure your funding request:

  • Your current funding needs.
  • Any future funding requirements over the next five years.
  • How you intend to use the funds you receive.
  • Any strategic future financial plan
10. Human resources management

Explain that your business can recruit, develop and retain the right people to move your business project.

 After you have finished writing the proposal, attach all those documents that support the details you have given in the proposal. Make sure that the details provided in the proposal match the supporting documents.

About Finline!

Finline is an online platform for creating financial reports for getting bank loans and investments. It’s like ‘Canva’ but for financials. If you are an entrepreneur looking for a bank loan, you need to have a well-crafted project report. We, at Finline will help you with that. Our team will help you create a powerful business plan in ten minutes. That too in your language. Our reports are accepted by all public and private sector banks working in India. Click to create your report.