Financing a franchise is easier than financing an independent business. Most commercial banks are comfortable with the franchise mechanism and franchisor support mitigates the bank’s risk to a large extent.

FNB has a dedicated Franchise division with a focus on franchise financing. Our centralized team has a wealth of experience and knowledge of the sector. All applications are handled and monitored centrally, while regional relationship managers are appointed to guide the franchisee through the application process.

To qualify for bank finance for a franchise, the prospective franchisee needs between 40 and 50% of the total franchise investment in cash or similar unencumbered funds. The bank can finance the balance if the applicant meets the required criteria. In addition to the own contribution, the franchisee also needs to offer some form of collateral. If no assets are available to offer as security, the applicant can consider a Khula guarantee, available through FNB.

The steps to follow to apply for franchise finance are outlined below:

Step 1 – Make contact with the franchisor and obtain provisional approval as potential franchisee.

Step 2 – Ensure that at least 40% of the total investment can be provided by the applicant in cash or similar unencumbered funds.

Step 3 –Complete FNB application form and contact us at franchising@fnbcommerical.co.za to start the application process.

Franchise Toolkit

The FNB Franchise Toolkit contains everything you need to complete your application. It includes:

• FNB Franchise Finance application form
• Business plan template
• Cashflow template

A full list of supporting documents required for the application is outlined on page 3 of the application form. If you have any questions about the application process, contact us at franchising@fnbcommercial.co.za

For further information on finance solutions or to apply for finance with FNB click here