The Five C’s form the underlying criteria for most types of loan: Capacity, Collateral, Capital, Conditions, and Character.

Capacity – does the applicant have sufficient income from their revenue streams to make the payment?

Collateral – are there assets that can be used if the borrower defaults? If so, the secured collateral is then sold by the lender to satisfy the debt.

Capital – do the business owners have their own money invested in the business? With more money invested, the borrower will work harder to ensure payments are made.

Conditions – do the current economic conditions have a negative or positive impact on payment?

Character – what is the applicant’s nature?  What is the background of the directors of the borrower’s business? What is their track record? What is the level of trust?

The first of these criteria, ‘Capacity’, is fundamental to the credit equation. Vision Critical enables lenders to identify if a business is right to move from conventional funding to asset based lending and the all-important effect on the cash flow and funds flow.

Through OSMO®, they can identify immediately whether a business is buying or selling more than it needs for its trading and if sales are being pre-invoiced or fresh air.