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My Business is facing challenges
If your Business is declined for finance, some of these options may
be available to you.
SME Credit Appeals
Some of our business customers are experiencing financial/cashflow pressures, with decreasing revenues and increasing costs. You could also be exposed to customers or suppliers who may be experiencing their own issues. We are fully committed to working with you to provide support and advice. Our process involves the following steps:
Step 1: Communication – talk to us.
It is very important to address the early signs of financial stress in your business. The sooner you contact your Relationship Manager or local AIB branch, the easier it will be for us to help.
It is in your interests to engage with us in relation to your arrears or financial difficulties. It is only with your engagement and cooperation with us, that a solution may be reached.
If you are in financial difficulties, we will arrange for one of our teams to work with you to explore potential ways of resolving the situation and will write to you informing you of their contact details.
We will consider any financial difficulties situation sympathetically and work with you constructively to explore appropriate solutions. In most cases, by continuing to work together, we will find an acceptable alternative way forward.
Step 2: Financial Information – understanding your finances.
The type of financial information required by us to make an assessment for an arrangement will vary depending on the nature and size of a business, but will typically include the following:
|Documentation Required||>Why AIB needs this information|
1. Financial Information/Projections
This information enables us to gain a real insight into how your company:
Short-term cashflow projections are of particular importance in the current
2. Details of current tax position
(Tax Clearance Certificate where appropriate)
|This will allow us to understand your current tax situation and any
arrangements that may be in place with the Revenue Commissioners.
|3. Up to date Asset/Liability profile of the business and owners/promoters.||This allows us to assess the overall financial position of the company and its business owners/promoters.|
|4. If required, details of your security position.||You may have provided security across a number of facilities which is relevant to the assessment of your situation.|
|5. Other information may be required as relevant to an individual case.||Your Case Manager will advise you of further information or clarifications we may require to ensure fully understand your particular financial requirements.|
To enable us to prepare in advance of our meeting with you, we require a business plan and cashflow. You may be also be asked to demonstrate in-depth knowledge of your competitive environment in which your business operates.
Step 3: Assessment – assessing your financial situation.
The information you provided will be used to assess your situation and explore various options to try to resolve the situation. The assessment will take your full circumstances into account, including overall level of borrowings, repayment capacity and previous repayment history along with your security position.
The assessment process for an alternative arrangement is not expected to take longer than 15 business days from the date of receipt of all of the information/documentation requested. If our decision takes longer than 15 business days, we will write to you to advise you how long it will take and the reasons why.
We may offer you an alternative arrangement to assist you to resolve financial difficulties subject to you meeting our criteria. The decision process will take into account your full circumstances such as, where applicable:
- the overall level of borrowings with both us and any other financial institution
- the current and future overall repayment capacity
- previous repayment history
- the existing security position with regard to your borrowings
- the viability of the business,
- your co-operation and the information you provide to us.
Throughout the assessment process, we will continue to work constructively with you to develop a sustainable solution for the business where possible. To help us do this, it is important that you:
- Act in good faith
- Keep to your agreements with us
- Keep us informed about developments or changes in your circumstances
- Carefully consider what our own and any independent advisors say
- Be prepared to make any necessary changes in a timely manner
Step 4: Resolution.
Once a decision has been reached to offer you an Alternative Arrangement option, we will write to you outlining all, or any, revised terms and applicable fees and charges.*
It is important:
- that you are fully aware of the details and implications of any new repayment arrangement before you commit to it. You may seek independent legal/financial advice in this regard.
- to note that alternative arrangements may be affordable for your business in the short term but could be more expensive in the longer term.
- that you keep up the terms of any agreed arrangement, or advise us immediately if there has been any change in your financial circumstances. Not telling us about problems could impact negatively on other facilities you hold with us, such as current accounts, credit cards, direct debits etc.
Step 5: Appealing a decision.
AIB has an internal appeals process for SMEs in financial difficulties. The process is available for all loans, overdraft, asset finance and invoice financing products irrespective of facility amount.
If your appeal through the internal credit appeals process is unsuccessful and the facility is for between €1,000 and €3,000,000, you may refer your case to the Credit Review Office.
The type of financial information required by the Bank to make an assessment for an arrangement will vary depending on the nature and size of a business, but will typically include the following:
- Central Bank – www.centralbank.ie
- Chambers Ireland – www.chambers.ie
- Credit Review Office – www.creditreview.ie
- Department of Jobs, Enterprise and Innovation - www.djei.ie
- Insolvency Service of Ireland - www.isi.gov.ie
- Irish Business and Employers Confederation (IBEC) – www.ibec.ie
- Irish Small and Medium Enterprises Association (ISME) – www.isme.ie
- Microfinance Ireland - www.microfinanceireland.ie
- Revenue Commissioners – www.revenue.ie
- Small Firms Association – www.sfa.ie
*Excess balances attract an annual Surcharge rate of interest which is levied on the entire excess balance, in addition to the annual interest rate applicable to the account. You may also incur Referral Item or Unpaid Item charges. Further details on these charges are available in your credit agreement or if applicable, in the ‘Business Fees and Charges’ brochure which is available in all branches and online at www.aib.ie. You can avoid incurring further surcharge interest by clearing the excess balance, ensuring that all future repayments are made when due and that your current account operates in credit or within your approved overdraft limit. You can avoid unnecessary charges for unpaid cheques, standing orders and direct debits by ensuring that there are sufficient funds in your account to pay these items when they are presented, and also by ensuring all cheques which you draw on the account, or which you lodge to the account, are drawn correctly.
If you do not adhere to the terms of your credit agreement while in financial difficulties it may affect your credit rating which may in turn limit your ability to access credit in the future.
Data relating to your arrears may be shared with the Irish Credit Bureau where permitted by contract and will be shared with a credit register if required by law.
If you own a micro-enterprise (turnover less than €2m and fewer staff than ten), you may be eligible for a Microfinance Loan. Find out more at www.microfinanceireland.com
It is vital that you co-operate with us in relation to your current financial situation.
Where you fail to co-operate, you will be classified as not co-operating which may have the following implications:
- we will not be able to assess you for an alternative arrangement; and
- we may take legal action immediately. Where legal proceedings are initiated, you will incur legal costs. Should it be necessary to take legal action to enforce security it is important to be aware that where security is realized, you will remain liable for any outstanding debt, including any accrued interest, charges, and other costs related to the realisation of security including, where applicable, legal and selling costs.
Under the SME Regulations 2015, you can only be classified as not co-operating when:
a) you fail to make a full and truthful disclosure to the bank of the information required by the bank to assess your financial situation, within the timeframes specified by the bank, and
b) a warning letter that you will be classified as not co-operating has issued to you and you have not carried out the action(s) specified in the letter within the advised timeframe.
Useful tools and guides.
This is a powerful financial planning tool and should form part of your business budgetary process. Use our cashflow planner to manage your business finances.